Pacific Capital Bancorp, the troubled Santa Barbara-based parent company of Santa Barbara Bank & Trust, has appointed former Goldman Sachs official Mark Olson as its new chief financial officer.
Olson replaces Donald Lafler, who has been serving as interim chief financial officer since Jan. 26, Pacific Capital officials said in a news release.
“Don’s long history with our company coupled with his finance expertise has been exceptionally important to us these past months,” said George Leis, Pacific Capital’s president and chief executive officer.
Olson, 47, has more than 20 years of financial industry experience. Most recently, he served as vice president and finance director at Goldman Sachs Bank USA, a commercial banking subsidiary of Goldman Sachs Group Inc., the fifth-largest bank holding company in the country.
“Mark is an outstanding addition to our senior management team,” Leis said. “He possesses a well-rounded skill set and has extensive experience managing the finance departments of highly successful organizations.”
Olson will be paid $225,000 a year, with a $100,000 sign-on bonus and 30,000 shares of restricted stock of the company, according to a Securities and Exchange Commission filing. Pacific Capital will provide Olson with a relocation allowance of up to $55,000 for incidental expenses, with reimbursement of moving expenses.
Goldman Sachs officials said Thursday they would pay $550 million to settle civil fraud charges over how the company marketed a subprime mortgage product. The SEC said the penalty was the largest ever for a financial institution, and leaves the door open for future civil suits. Many investors viewed the settlement as just a slap on the wrist for a bank that earned more than $13 billion last year.
Pacific Capital Bancorp is the parent company of Pacific Capital Bank N.A., a nationally chartered bank that operates 48 branches under the brand names of Santa Barbara Bank & Trust, First National Bank of Central California, South Valley National Bank, San Benito Bank and First Bank of San Luis Obispo.
The federal Office of the Comptroller of the Currency, or OCC, has called for Pacific Capital to achieve a tier-1 risk-based capital of at least 9 percent within four months and a ratio of total capital to risk-weighted assets of at least 12 percent within four months. Pacific Capital must comply or face possible liquidation.
Texas billionaire Gerald Ford announced in April his intention to invest $500 million in the bank. He is traveling and could not be reached for comment.
The OCC order requires Pacific Capital to submit a capital plan by Sept. 8, along with a strategic plan. If the bank can’t meet the minimum capital ratios, the agreement calls for Pacific Capital’s board of directors to submit a proposal to sell or merge the bank, or liquidate the bank.
Pacific Capital’s recent call report says nonperforming assets made up 6.13 percent of its total assets as of March 31. The bank’s annualized ratio of net charge-offs, or loan losses less recoveries, to average loans was 6.62 percent for the first quarter of 2010.
During the past two years, the company has laid off more than 315 employees and cut retiree benefits. A first-quarter net loss for the bank of $72.6 million followed a 2009 net loss of $405 million, as provisions for loan losses hurt the bank’s capital.
— Noozhawk contributor Ray Estrada can be reached at news@noozhawk.com.