Dive Brief:
- Dave Mansfield stepped down as CEO of Amesbury, Massachusetts-based BankProv on Dec. 20, a move the bank’s board and the former chief executive called a “mutual decision.”
- 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 serve as board chair, the bank announced.
- BankProv’s leadership transition follows the bank’s forecast last November that it expects to lose $27.5 million for the quarter ending Sept. 30, due to its lending exposure to the crypto mining industry.
Dive Insight:
Mansfield was named CEO of the $1.7 billion-asset bank in 2013, and had previously served as the firm’s CFO.
“Over the past 21 years, I have been fortunate to work with an amazing team at BankProv and I look forward to watching the Bank continue to grow,” Mansfield said in a statement last month. “I leave knowing the Bank is in capable hands.”
A bank spokesperson did not share the reason for Mansfield’s departure, but said Mansfield and the bank’s board believed it was time for new leadership.
“We will be forming a search committee and will spend the time necessary to identify the best candidates and choose a leader who is capable of continuing BankProv’s tradition of serving the community and providing innovative banking solutions,” the spokesperson said. “We’re confident that Carol and Joe will provide excellent leadership and an important sense of continuity in the interim.”
As BankProv searches for a new leader, the firm is facing a reckoning over its decision to lend to the crypto mining industry, a sector facing significant distress amid rising energy prices and a steep drop in Bitcoin value.
BankProv launched a deposit operation for crypto companies and expanded into business loans to crypto firms several years ago in an effort to break into an underserved market, according to the Financial Brand.
The bank issued its first Bitcoin-secured crypto business credit line in late 2020, and rolled out an Ethereum-secured credit line the following year, the publication reported.
In January 2022, the bank announced it had expanded its digital asset team, part of the bank’s push to provide a full-service offering for the cryptocurrency community.
But by the fall of last year, BankProv said it began to question the financial stability of its borrowers who hold digital-asset mining loans.
In a November filing with the Securities and Exchange Commission (SEC), the bank said the recent decline in the cryptocurrency mining industry could result in losses exceeding $27.5 million.
BankProv’s digital-asset mining loan portfolio totaled $76.5 million at the end of September, according to the filing.
“BankProv remains well-capitalized and on sound financial footing,” Reilly said in a statement last month. “Carol and I are confident in the Bank’s future and are ready to provide continuity as we chart our course forward.”
