Commercial Banking
Our Commercial Banking business focuses on the specific needs of middle market
companies and serves a broad range of industries, such as manufacturing, transportation,
wholesale distribution, retail and certain specialty industries discussed below.
Our Commercial Banking business also includes our Commercial Real Estate group,
which serves the needs of professional real estate investors and developers,
and our professionals focusing on specialized industries and products, such
as healthcare, finance and insurance, construction and engineering services,
security alarm finance and asset-based lending. We primarily target commercial
clients with approximately $10 million to $2 billion in annual revenue, although
the majority of our clients generate between $20 million and $500 million annually.
Due to our history and presence in Chicago, as well as the long-standing relationships
that many of our senior executives and commercial bankers have here, our largest
geographic market is the Chicago metropolitan area and surrounding areas in
Illinois. Since 2007, we have expanded our reach beyond Chicago and Illinois
by establishing a National Commercial Banking group within our Commercial Banking
business and opening several commercial banking offices in major commercial
centers to build our brand, diversify our geographical exposure and expand our
reach with our core client base. In addition to our bank branches in the Chicago
metropolitan areas, we also conduct our banking business through branches in
the St. Louis, Milwaukee and Detroit metropolitan areas and through commercial
banking offices in Atlanta, Georgia; Cleveland, Ohio; Denver, Colorado; Des
Moines, Iowa; Grand Rapids, Michigan; Indianapolis, Indiana; Kansas City, Missouri;
Minneapolis, Minnesota; Pittsburgh, Pennsylvania; and Stamford, Connecticut.
We may open additional commercial banking offices in other major commercial
centers in the future to continue expanding our geographic reach and growing
our Commercial Banking business.
Commercial Real Estate Loans. We offer professional real estate investors and
developers credit solutions for the construction, acquisition, redevelopment
and refinancing for major core property types, including office, industrial,
retail, multifamily, student housing and for-sale housing. We provide financing
opportunities for privately-held, entrepreneurial real estate companies as well
as for REIT and other institutional real estate clients. We generally are a
short- and medium-term lender for commercial real estate properties. The majority
of our investor and developer clients are based within our geographic footprint,
although the properties financed for them may be located in other regions. Our
commercial real estate specialists are located in the Chicago, Illinois; Atlanta,
Georgia; Denver, Colorado; Detroit, Michigan; Milwaukee, Wisconsin; Minneapolis,
Minnesota; and St. Louis, Missouri markets.
Specialized Industries and Products. Within our Commercial Banking business,
we have several teams of commercial bankers that focus on a particular industry
or a specific product offering that can be offered across industries. These
specialty banking teams employ relationship managers with relevant industry
experience and/or specialized product knowledge in order to provide tailored
banking solutions to fit the unique needs of clients in certain industries or
offer sophisticated lending products to commercial borrowers. We believe that
having banking professionals with expertise in and a focus on specialized industries
and products enables us to build stronger relationships with clients and better
serve their unique banking needs.
Our largest industry specialty is our healthcare team. We employ experienced
healthcare industry professionals who understand the industry’s unique
challenges and regulatory framework and the numerous healthcare sub-markets.
We have a particular focus on the senior care sector, including independent,
assisted living and skilled care/nursing facilities. Lending relationships in
this industry group are primarily with for-profit borrowers and the average
size of the credit relationship per borrower tends to be larger compared to
our non-specialty commercial lending portfolio.
Capital Markets. We have a team of capital markets professionals that work
with our commercial banking relationship managers to assist our commercial clients
with their risk management objectives by offering a suite of interest rate and
foreign currency hedging solutions. Our interest rate management products, such
as interest rate swaps, caps, floors, collars and swaptions, assist our borrower
clients in protecting themselves from unexpected interest rate movements, achieving
predictable debt service payments and balancing their mix of fixed and floating-rate
debt. To assist clients with their management of foreign currency transactions,
we offer foreign currency wire transfers and facilitate collection of foreign
currency drafts and checks, and to assist with their management of currency
fluctuations, we offer foreign exchange forwards, window forwards, swaps and
options.
Community Banking
Our Community Banking business serves the personal, residential mortgage and
small business banking needs of consumers and small businesses through our bank
branches. Our Community Banking business is focused primarily on the Chicago
metropolitan area, where most of our bank branches are located.
Retail Banking. Through a network of 24 full service branch office locations,
of which 19 are in Chicago and its suburbs, we provide traditional personal
banking and investment products and services, including checking, savings and
money market deposit accounts, certificates of deposit (“CDs”),
health savings accounts, and personal lending products, such as home equity
loans and lines of credit, auto loans (primarily for used cars), secured and
unsecured loans (often used to fund educational costs or consolidate debt) and
overdraft protection loans. We also offer retail deposit products through The
Palladian PrivateBank, our online banking portal.
Residential Mortgage Banking. We offer a full range of residential mortgage
loans for purchasing or refinancing one- to four-family residential properties,
primarily through a correspondent model in which we originate loans for sale
in the secondary market based on the underwriting standards of third-party investors
and transfer servicing rights together with the sale of the loan. In certain
cases, we retain originated mortgage loans for our portfolio, primarily jumbo
and nonconforming loans. We currently do not service loans for other entities.
We have residential mortgage origination teams in the Chicago, St. Louis, Milwaukee
and Detroit markets to serve the residential mortgage needs of the communities
in which we have bank branches.
Small Business Banking. Our small business banking group focuses primarily
on businesses with less than $10 million of revenue and their owners, as well
as non-profit organizations. This group operates primarily through a Chicago-based
team in our network of branch office locations and offers loans, deposits and
treasury management products and services similar to those of our Commercial
Banking business, but on a smaller scale. Because of the smaller size of businesses
served by this group as compared to our Commercial Banking business, small business
loans are generally underwritten based in part on the credit of the individual
owners. We also are a participating lender in U.S. Small Business Administration
loan programs. Consistent with our strategy of cross-selling products and services,
we seek to identify opportunities for referring individual owners of our small
business clients to our Private Wealth business and its dedicated team of private
bankers.
Private Wealth
Our Private Wealth business provides private banking and financial advisory,
trustee, and asset management services to high net-worth individuals (generally
those with more than $1 million of investable assets) and asset management and
retirement plan services to for-profit and not-for-profit corporate/institutional
clients. We offer our Private Wealth services mostly in the Chicago market and
from our banking offices in the St. Louis, Milwaukee and Detroit markets, where
we have full-service Private Wealth teams. Consistent with our relationship-based
model and focus on cross-selling products and services to our clients, our Private
Wealth business places a particular emphasis on servicing our commercial banking
clients and their owners and executives. As of December 31, 2015, approximately
22% of our commercial clients had a relationship with our Private Wealth business.
The products and services offered to our Private Wealth clients include the
following:
Private Banking and Financial Advisory - Our private banking team delivers a
full range of banking solutions to high net-worth individuals, including deposits,
loans and lines of credit for personal, business and investment purposes, such
as residential secured loans, lines secured by investment securities and other
secured and unsecured lines of credit. We also assist clients with financial
planning needs around life events such as retirement or education.
Trustee Services - Our trust department serves as corporate custodian and/or
trustee for a variety of personal trusts and retirement plans and provides other
custodial, guardianship/conservatorship and estate administration services.
We also offer escrow services for business transactions and legal settlements,
qualified intermediary services for tax-deferred real estate transactions and
“qualified custodian” services for clients who are holding assets
on behalf of their clients.
Asset Management - Our asset management team provides investment management
services to individual and corporate/institutional clients, which involves creating
asset allocation strategies for each client’s particular situation while
using third-party investment managers to execute these strategies.
Corporate Retirement Plan Services - Our trust and asset management teams provide
consulting, advisory, custodial and trustee (either directed or full/discretionary)
services to qualified and nonqualified retirement plans sponsored by our commercial
clients.