In the interim, there have been real questions whether Banc of California as an entity would even reach the 2018 MLS season, when LAFC begins play and the stadium opens.
A profile of the bank in the Los Angeles Times by James Rufus Koren last week fills in some of the details of what’s been a whirlwind six months or so for the bank, and what their issues could mean for the stadium deal.
Whispers began in the press in September, including a story on Bloomberg that strongly insinuated the bank had massive issues with personal conflicts of interest. Then there was an even more damning accusation, that the bank was being secretly controlled by a convicted fraudster, Jason Galanis. On top of all this smoke, the bank is being investigated by the SEC.
In the wake of that, Banc of California CEO Steven Sugarman, brother of LAFC co-owner Jason Sugarman (one of the reasons for the personal conflict of interest suggestions), resigned from his posts at the bank in January, and a vice chairman has subsequently resigned. New blood is coming to the bank’s board and executive positions, and that’s not all.
Koren reports Banc of California is laying off 139 workers in Orange County and sold its home loan division and equipment-financing division off recently.
So it appears the bank is working very hard to...well, that’s hard to say for certain, barring full knowledge of exactly what was true and what was pure speculation. But what does it mean for the LAFC stadium name deal?
Interestingly, the bank appears set to sink everything into that, while literally cutting back at most other sponsorship efforts. From Koren’s story:
In an investor presentation last week, executives said they will cut back on some of the bank’s sponsorship deals, in part to offset the $100 million the bank will pay over the next 15 years for naming rights at Banc of California Stadium, which starting next year will be home to new MLS franchise Los Angeles Football Club.
In the presentation, the bank said it would cut about $2.4 million a year on other sponsorships. The bank has deals with USC and San Diego State athletics programs, as well as with the Los Angeles Rams Foundation, though Boyle would not say which deals might be downsized or scrapped.
So I guess the good news is the bank is attempting to get on track, and does not appear to be backing out of their big sponsorship deal with LAFC. If it somehow did come to that, it wouldn’t be the first time there’s been a major issue with a sponsorship in MLS — the Colorado Rapids had to cancel their jersey sponsorship deal with Ciao Telecom in 2014, less than a year after the five-year deal was signed, because the company paid almost none of the promised money in the deal.
We’ll have to see if anything else comes up here on this front. This could be the calming down after six months of major turmoil, or the hits could keep coming for the bank, and possibly the expansion team. Stay tuned.
What do you think? Leave a comment below!