Saturday, June 05, 2004

Immigrant's experience prompts him to start bank - Thursday, 06/03/04

Immigrant's experience prompts him to start bank - Thursday, 06/03/04

Staff Writer
As an immigrant, Anil Patel says he's seen firsthand the problems that people like him can face obtaining financing and other banking services in the Midstate.

In 1985 six banks denied him a loan when he was trying to buy his first home, which Patel attributed partly to the lack of credit history he then had in the United States.

It's such realities for immigrants that the Clarksville, Tenn., gastroenterologist said led him to seek to start Civic Bank & Trust, which will be based in Nashville. Patel and other bank organizers recently filed for a charter with the state that, if approved, would allow them to raise as much as $20 million in startup capital.

Four of the five organizers are of Indian descent, including Patel, who has lived in the Midstate for 20 years since leaving the African nation of Zambia. Randy Austin, whose 30 years in banking included a stint as chief executive of The Bank-Oldham County in Kentucky, will be CEO of Civic.

Though the bank will target the entire Midstate community, it will focus on offering services to the growing immigrant population, Patel said. Its specific niches will include Asian immigrants and the medical community.

''Immigrants tend to have harder time with big banks just because the big banks cannot assess the risk,'' Patel said. ''They're willing to work, but they don't have the capital and access to tools to do what they're willing to do.''

If approved, Civic will join a growing list of banks nationwide being formed to target immigrants such as Asians and Hispanics. Such efforts reflect growth in the population and the purchasing power of immigrants.

From 1990 to 2001, the purchasing power of Asian and Hispanic residents nationwide rose 125% and 118%, respectively. Census data show that purchasing power of the black and Caucasian communities grew much less — 86% and 67%, respectively.

The number of Asian and Pacific Islander residents in a 10-county Midstate region more than doubled from 10,003 in 1990 to 20,560 in 2000, but that group still accounted for less than 2% of the region's overall population.

While several startup banks nationwide are seeing success targeting ethnic communities, some analysts aren't sure there are enough immigrants in the Midstate to make such an effort worthwhile.

''The Asian community is still very small in Tennessee,'' said Attilio Galli, a Midstate banking executive involved in a separate effort to launch a Nashville-based financial services company that has targeting ''underserved'' communities among its goals. ''We're going to take an income segmentation approach rather than an ethnic segmentation approach, because if you do that, you'll have a broader base of potential clients.''

Galli and a group that includes Nashville merchant banking firm 2nd Generation Capital are expected to file soon for a private-placement offering to raise money to buy an existing bank and expand its sales offices into distinct neighborhoods.

Jeff Davis, an analyst with FTN Midwest Research in Nashville, said large regional and national banks also were going after ethnic communities by designating certain branches to focus more on specific national groups.

''It's going to be a bit more tougher row to hoe, especially in Nashville, because the immigrant community is not necessarily huge. Secondly, it's spread out geographically,'' Davis said of Civic's plan to serve Asians.

That reality is why Civic will focus on the broader Midstate community, as well as eventually market itself to ethnic communities across the state, Patel said.

Nashville was chosen as headquarters for Civic because it is a hub for various international communities in Tennessee, Patel said. He hopes to open an office off West End Avenue by March. Patel is familiar with that area, having done his medical residency and fellowship at Vanderbilt University Medical Center. He also received an MBA from Vanderbilt.

''We feel like, particularly with the big banks being bought out, merged and so forth, there's still room for community banks (in Nashville) to offer a little bit more personalized service,'' Austin said.

Patel will be Civic's chairman and Austin will run daily operations. Other organizers include Ratilal G. Gajera, a physician in Hopkinsville, Ky.; Raman Patel, who owns hotels and motels in Clarksville, Tenn., and across the Southeast; and Magan B. Bhika, a MetLife insurance representative out of Brentwood.

''These four guys are successful people who are not under pressure to make money,'' Patel said about the group organizing Civic. ''What we want to do is establish an institution that will help the community long term.''

Getahn Ward covers financial services. He can be reached at 726-5968 or at


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