Hughes Quits at National Mercantile
National Mercantile Bancorp, a Century City bank holding company whose shareholders include some of Hollywood’s most powerful insiders, said Monday that William T. Hughes resigned as president.
The bank, which launched a major push into entertainment banking two years ago and had mixed success, in recent quarters has shown lackluster earnings and some losses, caused mostly by problem real estate loans.
The bank in July was subjected to regulatory enforcement actions requiring it to bolster its financial condition and to improve management and credit procedures. National Mercantile earned $51,000 in the six months ended June 30, compared to $21,000 a year earlier, a period during which it suffered increased loan problems.
The bank did not go into specific detail about why Hughes left. A spokeswoman described his departure as amicable and unrelated to the problems that sparked the regulatory action by the Office of the Comptroller of the Currency. Another source familiar with the bank added that it is unlikely Hughes was held responsible for the regulatory problems, many of which stemmed from loans made before he was hired in April, 1990.
Hughes, a former Security Pacific Bank executive, also was president and chief executive of National Mercantile’s main unit, Mercantile National Bank.
Once a low-profile real estate and business bank, National Mercantile came under scrutiny in Hollywood’s closely knit banking community in late 1989 and early 1990, when two groups of entertainment insiders--including a partnership affiliated with the powerful Creative Artists Agency--bought nearly 20% of it. The other major group was made up of associates of the business management firm Breslauer, Jacobson, Rutman and Sherman, and sevral celebrity investors.
The bank said that until a successor to Hughes is named, its operations will be coordinated by a committee of five officers.