Young Investors Claim 51 Percent of Farmington Hills-Based Bank

Four young entrepreneurs are leading an investors’ group purchase of 51% of Farmington Hills-based Bank of Michigan (BoM).

According to a BoM press release, the bank purchase was led by businessman Nick Sandiha, 38, his brothers and a nephew. The single biggest investor is Jimmy Asmar, 32; the other two principals are Saab Grewal, 30, and Jordan Jonna, 24. All are entrepreneurs whose families immigrated to the United States; all are involved in highly successful family-owned and family-operated businesses. 

The men and their families will become plurality owners of BoM by purchasing 51 percent of its shares from Capitol Bancorp Ltd. (CBC), a Lansing-based community bank development company, if all goes as expected. The men are among a group of more than 150 new and original bank investors. Once the transaction is complete, the bank will be 100 percent community-owned. 

Michael Sarafa, the bank's CEO, and board members, have been working on variations of a deal for over two years. Together, they led the bank through the most recent recession overcoming regulatory and economic hurdles to allow the bank to post profits in three out of the last four years.

“There was a cloud hanging over the bank and now we can finally say the cloud is gone and that we can get back to the business of banking,” said Sarafa. “This will make us a stronger and more viable bank and one that will be able to provide more services to the community. It also means that we should be more attractive in the marketplace, which will make it easier for us to raise capital and to offer more lending products.”

Also significant is the plan to open a BoM branch in Macomb County as soon as the end of 2013.

The deal will not affect the management team led by Sarafa. The top five officers all have been with the bank for five to seven years and cumulatively have more than 100 years of commercial, mortgage and retail banking experience. 

Sandiha, 38, is a managing member of Keystone Capital Management and co-founder of BoM who currently sits on the bank’s board. He and his family own and manage commercial properties and businesses in metro Detroit. He and his seven brothers are the bank's lead investors.

“When we first helped organize the bank, we were very excited and confident about the bank’s potential, the opportunity and the positive impact we could have on our community,” said Sandiha. “We have seen first-hand the potential of the bank and are looking forward to the next phase of this independent bank.” 

As Sarafa noted, the bank is ready for expansion and growth. BoM has purchased its attractive Cape Cod-style building on Northwestern Highway and is building out additional space to hire new staff.

"This transaction will allow to pursue a growth strategy that will allow us to better help businesses grow, reinvest and prepare for the realities of the new economy," Sarafa said. "There could not be a better time for the Bank of Michigan to become independent and wholly owned by the community.”