Castle Creek has closed its fourth fund, Castle Creek Capital Partners IV, L.P., with $331 million. The fund will focus on recapitalization, growth equity, and buyout investments in U.S.-based community banks. So far, the fund has invested in seven banks. Formed in 1992, Castle Creek is based in Rancho Santa Fe, Calif.
Castle Creek® is pleased to announce the final closing of its fourth fund, Castle Creek Capital Partners IV, L.P. (“Fund IV”), with $331 million in capital commitments. The capital was raised from a diverse group of institutional investors, including public and private pension funds, prominent fund of funds and financial institutions, with Thomas Capital Group serving as placement agent. The primary focus of Fund IV will be on recapitalization, growth equity, and buyout investments in U.S.-based community banks.
Fund IV’s focus during this extended economic recovery will be on turnaround and distressed bank investments. Castle Creek will use its deep industry knowledge and expertise to work in concert with local management to help restore profitability and enhance the growth prospects of its portfolio banks. Thus far, Fund IV has completed seven bank investments, establishing a well-balanced and diversified portfolio across six major U.S. metropolitan markets.
“We formed our fourth fund because we believe the severe recessionary downturn over the last three years has caused significant distress in the banking arena, and the valuations of select community banks will benefit greatly from a combination of additional capital support, the ongoing economic recovery, and a building wave of M&A activity,” Castle Creek Managing Partner John Eggemeyer commented. He added that in his view “this is the most opportune time in the past two decades to invest in the community banking sector.” Castle Creek has pioneered private equity investments in banks since its inception in the early 1990s and is today one of most prominent and active private equity bank investors in the U.S.
“We have been investing in special situations and distressed managers for more than a decade, and we believe Castle Creek Fund IV is one of the most coherent private propositions targeting the continued dislocation in the financial services sector,” said Jeff Collins, Portfolio Manager, Morgan Stanley Alternative Investment Partners. “Castle Creek’s operationally-focused and deeply experienced team, combined with the Fund’s focus on small- to middle-markets where we believe the potential for value creation is greatest, makes for a particularly compelling investment opportunity for AIP.”
In response, William Ruh, a Managing Partner at Castle Creek, commented, “We are deeply appreciative of the substantial financial commitment from such a highly- regarded group of limited partners – AIP included – and we are thankful for our partners’ unwavering support during this challenging fund raising environment.” Thomas Capital Group’s President and CEO Sajan Thomas added, “We were delighted to work with such a high caliber and professional group and are pleased with the outcome of the fundraise. I have great confidence that Fund IV will perform admirably on behalf of its limited partners.”
About Castle Creek Capital Partners
Castle Creek® focuses on recapitalization, growth equity, and buyout investments in U.S.-based community banks. The firm is led by John M. Eggemeyer III, William J. Ruh and Mark G. Merlo (the “Principals”). Since 1992, the Principals have overseen the investment of over $1.9 billion of capital primarily for bank transactions and have completed over 60 bank investments and acquisitions. The Principals apply their significant industry experience by becoming actively involved with the management of their portfolio companies with a view toward materially enhancing their efficiency, scale, profitability and franchise value. Further information about Castle Creek® can be found at www.castlecreek.com.
About Thomas Capital Group
Thomas Capital Group (“TCG”), a registered broker-dealer, was founded in 1997 to assist and guide alternative investment managers worldwide in structuring funds and raising capital. TCG’s team possesses extensive placement and marketing experience, a global network of close investor relationships, and strong buy-side investment experience. Working with a select group of fund managers, TCG has helped raise billions of dollars from leading investors around the world. More information can be found at www.thomascapitalgroup.com