This St. Petersburg bank tackles climate change and opened this week
A few days before the opening of Climate First Bank, Ken LaRoe already had $ 75 million in loans outstanding. It’s a good start, which led him to believe that people buy what the company sells.
But he couldn’t help but feel a little nervous, either.
“We have a lot of customers eager to get involved who are sitting there saying, ‘Okay, I open my account the first day you’re open,’ he said. “We say, ‘Uh, give us a week, please, so we can make sure everything is working.'”
Early enthusiasm has a lot to do with Climate First’s mission. As the name suggests, the bank of St. Petersburg aims to put climate change and sustainability at the forefront – not only in its own business practices, but through the investments it makes and the clients it chooses. .
“In short, we will not support evil,” said LaRoe, founder and CEO of the company.
Climate First Bank used its eco-friendly message to raise $ 37 million in capital. That’s well above LaRoe’s initial target of $ 25 million; he expected the total to reach $ 42 million by the time the bank opened Tuesday at 5301 Central Ave.
Part of this money comes from shareholders of the former LaRoe banks; some come from banking investors in general. About $ 1 million comes from LaRoe himself.
But some also come from what are called ESG (environmental, social and governance) funds, which support companies that adhere to selected social values and missions. And some were from people who heard about Climate First online or through the press, and invested because “they want to make a difference in the climate crisis,” LaRoe said.
How Climate First Bank will do this will take trial and error, LaRoe said. The company can offset its own environmental footprint by using solar energy and purchasing carbon credits. It can require its software vendors to meet certain sustainability criteria. It may offer better loan terms or better interest rates to persuade developers to incorporate LEED compliant items.
As customers begin to walk through the door, Climate First will have more difficult choices, LaRoe said. Will the bank do business with the small business owner who operates multiple franchises of a global corporation like McDonald’s? Will it lend to a manufacturer whose chemical disposal methods it cannot effectively follow?
“It all comes back to this customer who comes in and says, ‘Wait a minute, I thought I knew where my money was sleeping at night, and now I find out you put Joe Bob’s Auto Repair, and I saw him spill some dirty oil. down the storm sewer the other day, ”he said. “You can see the riddle for us.”
With all the required regulatory reports behind them and a queue of clients ready to open accounts, LaRue believes Climate First is in a good starting position. He intends to one day go public with the Climate First Bank – “I want to build the bank to last and be the acquirer, not the acquiree,” he said – but its success will largely depend on the extent to which it will succeed in sticking to its foundation. principles.
“What we can do from the start, we will do,” he said. “The last thing we want is someone to say we’re greenwashing. I eat, sleep and breathe this stuff. This is my reason for being.