Barney Frank Is My Hero

I moved to Boston in the fall of 1979. A year later, Barney Frank was elected to the U.S. House of Representatives. Along with many liberal Democrats from Massachusetts, Barney has been a political hero of mine for 35 years.

Barney is in a unique position to be a hero in the fight against Big Taxi.

He joined the board of directors of Signature Bank in June 2015. Signature holds $700 million in taxi medallion loans, primarily in New York and Chicago.

I have reason to believe that Barney is familiar with the mark-to-market controversy in Chicago detailed by my colleague Jay Hickman. See:

Medallion Financial & Credit Unions Behind Above-Market Chicago Taxi Medallion Sales
HVM Capital
June 1, 2015

Lenders Provide 100% Financing On Inflated Chicago Medallion Prices
Seeking Alpha
August 28, 2015

In early November 2015, Jay gave a presentation to Matt Kelley and Peyton Green, banking analysts for Piper Jaffray.

Kelley covers Northeast banks, including Signature. Green covers Southeast banks. Kelley moved to Piper Jaffray after Stifel Financial agreed to buy Sterne Agee in March 2015. Previously he worked as an analyst at Sterne Agee since 2006. Peyton Green also moved from Sterne Agee to Piper Jaffray in June 2015.

Stifel initiated coverage of Medallion Financial in June 2012. Troy Ward of Keefe, Bruyette & Woods (KBW), a subsidiary of Stifel, initiated coverage of Medallion Financial in June 2012 and continues as KBW’s analyst for Medallion. Christopher McGratty of KBW currently covers Signature.

Stanley Kreitman has served on the board of Medallion Financial since 1996. Previously he was on the board of the privately held Tri-Magna Corporation from 1991 until it’s rollup with two other firms into the newly created Medallion Financial in their 1996 IPO.

Kreitman was “deeply involved in the founding of Signature Bank” in 2001 after joining the four-member Advisory Board. The Board’s “function is to provide senior management with advice on strategic direction and business development initiatives.”

He was appointed to Signature’s board of directors on February 28, 2003, a year before Signature’s IPO on March 23, 2004.  In 2006, he resigned as a director and went back to the Advisory Board.

Certainly Kreitman was instrumental in Signature’s entry into the medallion lending business early on.

Certainly Kreitman was also instrumental in the creation of the Signature Financial subsidiary in 2012. The unit was built around the hiring of Walter Rabin as the unit’s president in June 2012. Rabin brought on board an eight-member executive team who’ve worked together for 16 years as of 2015.

Including John Cetta, Director of Taxi Medallion Finance, all joined from Capital One’s All Points Capital subsidiary. Walter Rabin was also President and CEO of the Capital One subsidiary until his move to Signature in 2012.

The team was formed in 1999 at North Fork Bank under the leadership of John Kanas, North Fork’s Chairman, President and CEO. The team moved to Capital One after Capital One’s acquisition of North Fork in 2007.

Since 2009, Kanas has been Chairman, President and Chief Executive Officer of BankUnited.

BankUnited holds $214 million in medallion assets.

Capital One holds $800 million in medallion assets.

Medallion Financial holds $728 million in medallion assets.

Signature Bank holds $700 million in medallion assets.

Together the four hold $2.4 billion in total, one-third of the $7.5 billion of medallion loans countrywide.

After 14 years, Stanley Kreitman remains Big Taxi’s most powerful representative at Signature.

For 24 years Kreitman has worked with Alvin and Andrew Murstein of Medallion Financial. He knows everything worth knowing about Big Taxi.

I trust that Barney has benefited from the Big Taxi expertise of Stanley Kreitman, Matt Kelley, Peyton Green, Christopher McGratty and Troy Ward.

If anyone can analyze the impact of Big Taxi on the financial industry, it’s Barney Frank.

Barney Frank is my hero.

 

Readers: please note the email below.

From: Barney Frank
Date: Wed, Dec 2, 2015 at 9:07 AM
Subject: Response
To: gordongossage@gmail.com

Mr. Gossage,

Your email to me left me uncertain as to what you wanted me to do. After our phone conversation on December 2, 2015, I must tell you that I believe it would be a violation of my fiduciary duty as a Signature Bank Board Member to work with you on your project, and I ask that you contact me in the future only through formal communication through the bank.

Barney Frank

 

 

 

 

 

 

 

 

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