Peapacking Heat: How One Regional Bank Found Opportunity — and Talent — in a Crisis

Most people in finance remember where they were when they heard Silicon Valley Bank had collapsed. And, if you were in New York City, the failures of Signature Bank and First Republic Bank were likely even more palpable. Both were major players in financing the city’s commercial real estate over the years, but ultimately became the second- and fourth-largest bank failures, respectively, in U.S. history. 

Signature Bank, in particular, had been a consistent, go-to lender in the five boroughs, and a top three multifamily lender. At the helm of its lending activities was Joseph Fingerman — also the highest-profile, most visible member of the team. At the time of the bank’s demise, he and his team had accumulated a $33 billion commercial real estate loan book — executing $4 billion across 632 loans in 2021 alone — along with a reputation for being relationship lenders that borrowers could rely on, and trust. 

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When Signature Bank failed on March 12, 2023, CRE loans weren’t the cause of its demise. Rather, the fatal blows came from the bank’s $16.52 billion of cryptocurrency coupled with contagion from SVB’s failure, which kick-started a quick outflow of deposits. 

“It was never in our minds that we would fail,” Fingerman said. “We were quite solvent when the FDIC seized us, so the thought of this happening was surreal. In our opinion, it was a definite overreach of [the FDIC’s] authority, and we just couldn’t understand how this could be possible. The first thing you think about are your clients and employees and what to say to them. Unfortunately it takes time to gain some clarity, especially during times of turmoil and unanswered questions.” 

The bank run on Signature escalated on Thursday afternoon, March 9, and by Friday several members of the lending team, including Fingerman, were called in to review and prepare loans for pledging to the Federal Reserve. “We spent the weekend working tirelessly in the office, wrapping up around 3 p.m. Sunday before I went home to relax with my kids,” Fingerman said. 

While he was watching the NCAA tournament with his family, news broke on CNBC that the bank had been seized, and Fingerman’s cellphone immediately lit up with messages. “It was a surreal moment,” he recalls. “By Monday, we were operating under an FDIC bridge bank, and a week later it was announced that only deposit operations were sold to NYCB/Flagstar, while the CRE and fund banking portfolios were retained by the FDIC. After 16 years [working at Signature] in CRE, it hit me hard that I wouldn’t be part of the acquiring bank’s future.” 

There are many theories around what eventually led to the seizure, and Fingerman has his. “Texts and tweets can make a bank run a reality in minutes in this day and age,” he said. “In order to have a systemic failure you need two banks, and we had a somewhat similar business model to Silicon Valley Bank — so we were in the wrong place at the wrong time.” 

First Republic was next. It may have been headquartered in San Francisco, but its loan book had heavy exposure to New York City real estate, adding to the void that Signature left behind. An over-reliance on uninsured deposits coupled with continued loss in depositor confidence was also key in First Republic’s demise on May 1, but so was its book of low-interest mortgages, fatally impacted by a series of rate hikes that reduced the market value of those assets. 

While the world watched in stunned silence as the banking crisis unfolded, wondering whether a more widespread run was next, for some, the institutions’ failures didn’t just open a window of opportunity — it took that window clean off its hinges. 

“The opportunity when Signature and First Republic closed their doors was to run into New York City — not walk,” said Douglas Kennedy, president and CEO of New Jersey-headquartered Peapack Private Bank & Trust. 

Indeed, opportunity came sprinting through the door, with Peapack having the ability to hire teams from both of the failed banks, notably two of Signature Bank’s most well-known, respected players — Fingerman and Andrew Corrado. In order to fully capture the opportunity left behind in New York, Peapack would also need a Manhattan location, and a plan to fill the immediate, abrupt and gaping regional bank-shaped void.

“When Signature failed, people would call me and say, ‘Joe, you don’t understand what a loss it is to have Signature go out of the market,’ ” Fingerman said. “They’d say, ‘I’m sure it was a big loss to you, but it was a huge loss for the real estate community.’ I’m really excited to be able to bring that back at Peapack.” 

They say you don’t know what you’ve got until it’s gone, and so Fingerman is also confident. 

“There are two types of real estate people: those that are banking with Peapack, and ones that will be banking with Peapack,” Fingerman said. “Our goal is to put the Peapack brand in front of people, show them who we are, and continue to execute.”

104 years young

If you’re Googling “Peapack” right now, you might not be alone. Although the bank has been around for more than a century, many outside of its home territory are unfamiliar with the New Jersey bank. (Fingerman said he often chats with his peers today, and only at the end of the conversation will they say, “Wait, where are you now?!”) 

Kennedy describes Peapack as a “104-year-old startup” — one that he joined 12 years ago when the bank was the ripe old age of 92. Previously Peapack-Gladstone Bank, the company reorganized and combined its banking and wealth management divisions in 2024, rebranding as Peapack Private Bank & Trust. 

When he joined Peapack in 2012, the bank had a great reputation around client service but wasn’t overly sophisticated on the lending side, Kennedy said. It was a $1 billion balance sheet bank with a $2 billion wealth management business. Kennedy looked to other successful boutique organizations he thought Peapack could emulate — specifically the regional banks that had a single point of contact and a hyper-focus on client and borrower experience. 

Oddly enough, Signature and First Republic were two of those banks. 

“What they had in common was a single point of contact handling the transactional and operational needs as well as the lending, and doing it not only at a corporate level, but also on a personal level,” Kennedy said. 

His team put together a 200-page document analyzing the two banks’ business models, how they were structured and how they paid their people, and began to adopt a similar client-centric business model at Peapack in New Jersey. When Signature and First Republic vanished from the market starting in March 2023, Kennedy saw the chance to bring what he had been building across the Hudson River to Manhattan. 

“I knew we had to run into the city and start a business that looked and felt like both of those banks in order to fill the massive void they had left,” Kennedy said, speaking from Peapack’s shiny new Manhattan offices at 300 Park Avenue. “I knew that the banks that were already here [in Manhattan], even the smaller ones, couldn’t fill that void because that high level of service wasn’t part of their business model, whereas it was already very much part of our DNA.” 

Not that this plan of action was quite as immediate as more timely concerns in the midst of the banking crisis.

“For the first two weeks [after Signature failed] I wanted to make sure that there wasn’t going to be a run on us, and that we weren’t going to fail,” Kennedy said. “Once I became certain it wasn’t going to happen, it was a run into New York City. We recruited a team, principally out of First Republic. Six months later I called Andrew [Corrado] and said, ‘Andrew, I’m coming into New York City to start a business. Can you coach me on what I should do?’ He said, ‘It’s funny you called, because I’d be interested in joining you, and I have a whole team of other individuals who might be interested as well.’ ”

Peapack hired 100 people in total from the two banks, the majority from Signature. There was just one rule as Kennedy went about putting his plan in motion:  “We don’t hire jerks — strictly no assholes.” 

‘A little like Van Halen’

Corrado, previously an executive vice president and head of the Northeast region at Signature Bank, running 100 banking teams, was working as a group director at Flagstar Bank when he got the call. Flagstar had acquired a large portion of Signature’s assets (and liabilities) post-failure. 

“There wasn’t the ability to navigate the market as we once had,” Corrado said of his time at Flagstar. “Having interacted with Doug historically, and having the same, client-centric thought process, I felt that there could be a good match here.” He joined Peapack in March 2024, roughly a year after Signature failed. 

Meanwhile, Fingerman had taken a role at a nonbank —A&E Real Estate’s lending arm —but his banking roots were calling. 

“I felt like my highest and best use — to use an appraisal term — was back in a bank,” he said. “It was just a question of finding the right bank.” 

Fingerman met with several banks before Peapack, and — for good reason — felt he was interviewing those banks just as much as they were interviewing him. “I wanted to know their headaches, and what I’d be getting myself into,” he said. 

But Peapack, he already knew. The bank had been a formidable competitor of Signature’s for years in New Jersey. It had a large real estate portfolio, the two banks would often trade deals back and forth, and they had several clients in common. “It gave me comfort that they were able to produce a $2 billion-plus mortgage book and had a general idea of what was going on in commercial real estate — as not everyone does,” Fingerman said, adding that he felt Peapack was the best fit for him, given its culture, client focus and position in the market. 

Further, Kennedy, Corrado and Fingerman had similar beginnings, having all worked at North Fork Bank at various times. When Fingerman was a young analyst at the bank, Kennedy was running the bank’s New Jersey operations and Corrado was running the Long Island region. When Capital One bought North Fork in November 2008, Fingerman left for Signature Bank.  

“We eventually dragged Andrew to Signature [in March 2014],” Fingerman said. “We’d also tried to drag Doug to Signature over the years, and so what was I going to say to this [Peapack] offer? It feels a little like Van Halen — the band’s back together again.”

The Signature fallout — from the bank’s failure to the shedding of its staff to the bank’s loan portfolios auction process — had been the industry’s obsession and must-read news, and Fingerman’s moves were keenly watched. 

Keeping a secret in New York City real estate is like trying to nail jelly to a wall, however, and Fingerman’s interview setting at Peapack didn’t help too much. “I was sitting in this glass fishbowl of a conference room with people I’d known for years walking by and texting me while I was still in the interview,” Fingerman recalls, laughing. 

When he accepted Peapack’s job offer, he already had a plan to help build the brand. 

“Peapack didn’t have a retail location in New York to garner deposits previously,” Fingerman said. “When I took the role, I thought I’d be able to either go after the existing clients that have loans with us for deposits or — over the next few years — replace that book with my existing clients. Now, I’m doing a little bit of both of those. We’re working to make our book more relationship-focused, where we can go after clients for deposits, wealth, cash management, home mortgages, whatever they need — and it’s been really well received by the New York marketplace.” 

In March 2024, when Corrado joined Peapack, the bank’s headcount was around 500 people. A little over a year later, it’s risen to 670 and the bank has grown its staff by more than 30 percent. Peapack has a $6 billion loan book today, of which roughly $2.5 billion is commercial real estate loans in the New York metro area and New Jersey. Its primary clients are family offices that own around 10 properties, have been in the business for typically decades, and place importance on a personal touch — a dedicated person to speak with who can handle both their deposit and lending needs. 

“With all the change in the landscape in the banking world, clients are yearning for what they had pre-2023, so we’re providing tailored solutions to each one of the clients,” Fingerman said. “On the commercial real estate side, we’re lending on multifamily, retail, industrial and mixed-use properties throughout the New York metro area. While we have the capacity to lend on a much higher number, we’re trying to keep the loans under $20 million.” 

 

The end of the gun

Many theories exist around what ultimately led to the untimely demise of the banks that failed in 2023. Kennedy, Corrado and Fingerman agree that a bank’s culture is key to its success, while pressure to feverishly grow can be a killer. 

“I’ve never subscribed to ‘You have to close $300 million of loans per quarter,’ ” Fingerman said. “You have to find good business first, because I think when you’re given quotas, you end up making really bad decisions.”

In addition to its crypto book, and funding its activities through largely uninsured deposits, Signature aggressively grew from $50.6 billion to $110 billion in assets between 2019 and 2022 — without adequate risk management practices in place to match that growth, according to a FDIC report. 

Kennedy, a member of the New York Fed’s board of directors since 2020, carefully studied the FDIC postmortems on SVB, Signature and First Republic. 

“All three of those banks were trying to fuel a growth story,” Kennedy said. “What they shared in common in their culture —which I think is wrong —was to grow at any cost.” 

It’s a mindset that Peapack is steering well clear of. 

“The lesson learned, and what we’ll not do, is drive this company for a number,” Kennedy said. “That’s not our preamble. I don’t care if we grow or don’t grow, let’s just go out and get the client. Let’s please them like we can like nobody’s business. Let’s get paid fairly for what it is that we do, and whatever the size that comes out of that, that’s fine.” 

The big takeaway for Kennedy is “don’t focus on growth, focus on the client, focus on executing superbly for that client, and let the rest of it all take care of itself,” he said. “If you do that with really good people — who are not assholes and work collaboratively — the growth and the shareholders, all of that will follow. And this is a deep enough pond in the New York metro area, with $2.8 trillion in deposits. That’s the fuel that we need to lend, and just crumbs in this market is enough to make Peapack successful.” 

Banking on Manhattan

To get those deposits and truly fill the void left by Signature’s exit, Peapack needed a location and retail branch in New York City. Kennedy had managed teams in New York City during his time at Capital One, and he knew Midtown was where Peapack had to be. In January 2024, it announced plans to open at Tishman Speyer’s 300 Park Avenue, officially opening its doors in March 2025. 

The location houses 6,000 square feet for its private banking center and an additional 18,000 feet of office space on the 13th floor. 

“We’re not just a New Jersey bank opening up a branch in Manhattan,” Kennedy said. “This is a transformational change, and we’re here for the long haul.”  

Kennedy views the bank’s new retail location — which includes a quarter-million-dollar horse statue in the lobby window that’s illuminated at night — as an announcement of sorts. It’s certainly caught the eyes of some of Peapack’s competitors, who have been taking selfies with the horse as they pass and sending them to Fingerman. 

“It doesn’t say typical retail bank,” Kennedy said. “It’s really there as a billboard, a showplace, a sign of our commitment.” 

The bank may not be hyperfocused on growth, but it’s happening anyway. Peapack thought it could bring in around $400 million in deposits in 2024 through Corrado and the New York teams they’d hired. It ended the year at $1.2 billion. 

As it expands its business in New York, the team is focused on building out Peapack’s business diligently, but in partnership with clients.

“The client experience is changing. We’re saying to clients, ‘If you want to use that side of the balance sheet and be borrowers, we would like to have some deposits from you,’ ” Fingerman said. “My core group in New York, together with the legacy team in New Jersey, basically went through both books, Signature and legacy Peapack, and said, ‘These are the clients that we want to go after, and these are the clients that are perfectly fine. But if they’re more transactional and not willing to give us deposits, we would like to either convert them to a client, or be paid off.’ And, so, we’ve been going after the city’s top borrowers and saying, ‘Hey, we’re Peapack and this is what we could do for you. Give us a shot.’ ” 

Most of those conversations are going well, Fingerman said: “Most people say, ‘It’s so good to hear from you,’ because they have personal relationships with me, with Andrew, with the staff that we brought on, with Peapack’s legacy staff.” 

As such, Peapack’s pipeline is shaping up nicely. “It’s being carefully managed to make sure that we’re getting the right loans, the right deposits, the right ratios,” Fingerman said. 

Given that the run on regional banks a couple of years ago scared the bejeesus out of most, Peapack is focused on giving clients plenty of reassurance that their deposits are safe. 

“We made the strategic move when we came into New York to lead the discussion and take any angst off the table around ‘Who is Peapack and how stable are you?’ ” Corrado said. “So, even though our balance sheet and capital ratios are some of the highest in the country and we’re one of two or three banks — with less than $10 billion in assets — in the country that have a Moody’s investment-grade rating, our clients need to be able to rest at night and go to sleep knowing that the monies that they’ve invested are safe.”

As such, Peapack leads with a product called ICS — essentially a reciprocal arrangement where deposits are held with other FDIC banks across the country in order to pass through the FDIC coverage. 

“Customers aren’t capped at $250,000 [in FDIC insurance coverage] — there’s up to, I think, $220 million that they could be covered for in today’s environment, based upon the number of participants across the country,” Corrado said. “It’s a cost to us, but we bear that cost because we felt it was the right thing to do from a business perspective, to give those clients peace of mind, and as part of our entree into New York.”  

As Peapack works to fill the customer-centric lending void Signature and First Republic left behind, Fingerman knows he has a long road ahead as the bank establishes a longer track record and more familiarity in New York — but he’s just getting started. 

“I was at Signature for 16 years, and that platform wasn’t built overnight,” he said. “It was constant work and we went through several market highs and lows, but we were there for our clients. We want to have that same lender-borrower relationship here.”

Cathy Cunningham can be reached at ccunningham@commercialobserver.com.