PAN AMERICAN BANK
East Los Angeles
FOUNDED: 1964
CEO: Jesse Torres
FOCUS: Hispanic community
L.A. COUNTY BRANCHES: 1
When Jesse Torres returned to his native East Los Angeles more than three years ago to run the oldest Latino-owned bank in California, he hoped to strengthen its brand and grow it from $43 million in total assets to $100 million.
Instead, Pan American Bank’s assets have shrunk to $38 million and it closed two existing branches, all while watching newer Hispanic market competitors, such as ProAmerica Bank, eclipse it.
Pan American, one of the smallest banks in Los Angeles County, has struggled to recover from the recession and the effects of tightened banking regulations in part because of its heavy focus on Hispanic customers, who are not always receptive to traditional banks. That has put a kink in its growth plans.
“My hiring was the beginning of a process expected to take a year,” he said. “But it has taken much longer as we struggled to find the right people with the right skill set and love for what we do, to grow the bank to its full potential.”
About 40 percent of the Mexican and Mexican-American community Pan American serves is unbanked or underbanked. It presents challenges from both ends of the demographic spectrum: Older residents distrust banks or believe they are too expensive, while a younger, more assimilated generation prefers mainstream banking to the neighborhood institution, Torres said.
Despite the challenges, he remains committed to his community: “We’re happy being considered a starter bank and we will continue to do the hand-holding it takes.”
For Pan American, that means a fully bilingual staff and extensive education on financial, entrepreneurial and computer literacy provided in partnership with three non-profit agencies. Torres is personally on Facebook and Twitter doing bank outreach, and he participates in local cultural and school events in an attempt to gain the trust of potential customers.
Torres has deep roots in the community. The son of Mexican emigrants struggled with poverty in his youth. He graduated from UCLA in 1992 and went on to the Treasury Department and a career in banking. When he was tapped as chief executive of Pan American in June 2009, he jumped at the chance to give back to his community.
The bank was founded in 1964 by Ramona Acosta Bañuelos, the first Latina to serve as U.S. treasurer, under President Nixon. An entrepreneur and owner of Ramona’s Mexican Food Products Inc. in Gardena, she started the bank after she ran into difficulty securing a business loan.
Today, Latino entrepreneurs still struggle to establish credit, something Torres wants to remedy with the bank’s new certification as a Small Business Administration lender. He also hopes it can finally jumpstart the bank’s long-planned expansion.
“We’re still around,” he said. “We managed to survive the worst of the economy, now we need to focus on getting stuff done in 2013.”
— Karen E. Klein
