April 13, 2024

Cross River Adds Investment Banking Services for FinTechs

Cross River Bank and CRB Securities are moving into the investment banking space.

The company’s investment banking team will help FinTechs with decisions such as mergers and acquisitions, capital markets transactions and other corporate finance matters, according to a Monday (Feb. 26) press release. It will be led by industry veterans Benjamin Samuels and Henry Pinnell.

“We are proud to launch our investment banking division of our broker dealer with two well-respected professionals in the industry, combining decades of experience in both the fintech industry and capital markets,” Gilles Gade, founder and CEO of Cross River, said in the release. “Ben and Henry are tasked with enhancing even further our product offering to our fintech partners and beyond, enabling us to solve the distinct needs of each and every client.”

According to the release, CRB Securities has until now focused mostly on helping clients with privately placed credit transactions, such as asset-backed securities.

“The decision to expand into investment banking comes at a time of increasing demand for creative solutions in fintech and our commitment to serving our every client’s strategic needs,” the release said.

Samuels comes to Cross River after serving as co-head of alternative capital solutions within the global capital markets group at Morgan Stanley. Pinnell was previously senior managing director and head of the FinTech investment banking effort at SVB Securities. Both men will serve as co-heads of investment banking.

PYMNTS spoke last year with Anthony Peculic, head of BaaS and Card, FinTech Banking at Cross River, about the challenges facing small and medium-sized businesses (SMBs).

“It is definitely a perfect storm, and not in a good way,” Peculic told PYMNTS.

“Small businesses at this point are challenged to find funding sources given that cost of capital is at its highest, interest rates are sky high, and banks and other service providers are tightening up their own offerings,” he added. “And that’s not to mention the challenges that SMBs are facing from their own consumers who are dealing with similar macro pressures.”

During the pandemic, SMBs relied on financial lifelines, such as the Paycheck Protection Program (PPP), to weather the crisis. As these resources faded away, they faced rising inflation and interest rates, making traditional funding sources less accessible and affordable.

But while access to funding is a crucial factor for the survival and growth of SMBs, research by PYMNTS Intelligence and Cross River, as seen in “What’s Next in Credit: How Lack of Credit Access Impacts SMBs,” found that 60% SMBs are denied access to the funding they need.

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