Breaking News

BankProv CEO resigns months after bank’s crypto-loan loss

Dive Transient:

  • Dave Mansfield stepped down as CEO of Amesbury, Massachusetts-based BankProv on Dec. 20, a go the bank’s board and the former chief government known as a “mutual determination.”
  • BankProv named CFO Carol Houle and Joe Reilly, the bank’s chair, as interim co-CEOs and co-presidents. Laurie Knapp, chair of the bank’s audit committee, will provide as board chair, the lender declared. 
  • BankProv’s leadership transition follows the bank’s forecast previous November that it expects to drop $27.5 million for the quarter ending Sept. 30, due to its lending publicity to the crypto mining industry.

Dive Perception:

Mansfield was named CEO of the $1.7 billion-asset lender in 2013, and experienced earlier served as the firm’s CFO.

“About the previous 21 yrs, I have been fortunate to do the job with an wonderful crew at BankProv and I appear forward to looking at the Lender continue to improve,” Mansfield claimed in a assertion past thirty day period. “I leave realizing the Financial institution is in capable arms.” 

A bank spokesperson did not share the rationale for Mansfield’s departure, but reported Mansfield and the bank’s board considered it was time for new leadership. 

“We will be forming a lookup committee and will spend the time necessary to detect the finest candidates and choose a leader who is able of continuing BankProv’s custom of serving the local community and giving modern banking solutions,” the spokesperson said. “We’re assured that Carol and Joe will give outstanding leadership and an critical perception of continuity in the interim.”

As BankProv queries for a new leader, the firm is going through a reckoning more than its conclusion to lend to the crypto mining marketplace, a sector experiencing major distress amid rising electricity charges and a steep fall in Bitcoin worth.

BankProv released a deposit procedure for crypto corporations and expanded into company financial loans to crypto corporations various several years ago in an work to crack into an underserved industry, in accordance to the Money Brand.

The bank issued its very first Bitcoin-secured crypto business enterprise credit history line in late 2020, and rolled out an Ethereum-secured credit score line the next yr, the publication documented.

In January 2022, the bank introduced it had expanded its digital asset team, part of the bank’s drive to give a comprehensive-provider featuring for the cryptocurrency local community.

But by the drop of very last yr, BankProv explained it started to query the economic security of its debtors who hold electronic-asset mining loans.

In a November submitting with the Securities and Trade Fee (SEC), the financial institution stated the the latest drop in the cryptocurrency mining industry could end result in losses exceeding $27.5 million.

BankProv’s electronic-asset mining personal loan portfolio totaled $76.5 million at the end of September, in accordance to the submitting.

“BankProv remains effectively-capitalized and on sound money footing,” Reilly mentioned in a assertion past month. “Carol and I are self-assured in the Bank’s long term and are prepared to deliver continuity as we chart our class ahead.”