The tide of green initiatives is set to wash over the Bay Area banking scene.
New Resource Bank, which was founded by an East Bay entrepreneur, is formally launching a business that plans to finance companies and organizations that emphasize green or sustainable operations.
"We want to finance sustainable resources in the community," Peter Liu, a Piedmont resident who is founder and vice chairman of the bank, said Monday.
San Francisco-based New Resource Bank sees as inviting a number of industries in the green or sustainable arena, Liu said.
"Organics, green energy, green buildings, are sectors that have been growing much more rapidly than the rest of the economy," Liu said.
For example, the organics industry generates $15 billion in revenue and is growing at 20 percent a year, according to figures cited by the Organic Consumers Organization. Liu said the clean energy industry has been growing by 20 to 30 percent a year.
"Our approach is that for every lending that we do we will try to finance a green business, or work actively within a community business to find a way to adopt green and efficient options," Liu said.
It appears that more than a few investors believe New Resource Bank, which has scheduled a formal launch for today, is more than a touchy-feely quest.
For one thing, Liu has an extensive banking background, including stints at Chase Manhattan and C.S. First Boston. And his bank has lured two executives from Mt. Diablo Bank to join the startup in the respective posts of chief operating officer and head of construction financing.
What's more, the drive to raise capital was over-subscribed. The bank raised about $24.8 million, Liu said. But it attracted $35 million from investors and had to return $10 million.
"That is one of the largest offerings for a new bank in Northern California," Liu said. "We are confident that there is enough support for a secondary offering if we need to grow."
At present the bank's only outlet is in San Francisco. But it is looking at other branch offices, including one in the East Bay.
The original investors include some high-profile business names, including venture capitalist Bill Hambrecht and high-tech entrepreneur Bob Epstein, co-founder of Dublin-based Sybase Inc.
"In the Bay Area, we have seen significant growth of businesses that are green, organic, or sustainable," Epstein said Monday. "The Bay Area also has a shortage of community banks. The combination of a unique market and a shortage of community banks makes it a good investment."
Epstein said the bank's organizers believe New Resource Bank is the first green bank in the nation.
The bank also has agreed to funnel a portion of the ATM and check card point-of-sale fees the financial institution collects to certain community partners The bank will provide its partners with 5 cents from each point-of-sale transaction and 3 cents for each ATM transaction, Liu said.
One early partner is Marin Organic, a Point Reyes Station-based association of ranchers, farmers, agriculture advisors and marketing specialists. A variety of North Bay businesses could benefit from the collaboration, said Sheila Foster, development director with Marin Organic.
"It's fantastic to have this bank," Foster said. "We have dairy producers, meat producers, organic vegetable producers, a creamery, an oyster farm."
The members of the organic association also use a variety of alternative energy sources to power their operations, said Helge Hellberg, executive director of Marin Organic. More than one-third of the 32 producer-members of Marin Organic use alternative energy sources.
"This is not just some hokey way to do it," Hellberg said. "This is state-of-the-art, never-done-before, efficient energy production."
Hellberg said he believes the investors in the bank could harvest a bigger profit in other kinds of community bank investments.
"The investors expect they will get a lower rate of return," Hellberg said. "But they know this is a social investment and a social return for their investment."
Even people in the environmental movement concede there are no assurances the bank will prosper long-term. But Eric Antebi, spokesman for the San Francisco-based Sierra Club, believes such financial ventures are worth the risk.
"There is no question that we need new ideas and new energy when it comes to financing for social or environmental change," Antebi said.
Reach George Avalos at 925-977-8477 or gavalos@cctimes.com.
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