Banker's hours

Plenty of people think about sports during work.

But at least Robert Sarver has an excuse for it.

He's best known in Arizona as the largest owner and managing partner of the Phoenix Suns and Phoenix Mercury. If any reminder was needed, his 14th-floor office looks out on US Airways Center.


But despite the sports connection, Sarver is first and foremost a banker. He also is the newest CEO of an Arizona public company, following the relocation of his firm from the Las Vegas area late last year.

"By far the majority of my time is spent running Western Alliance Bancorporation," said Sarver, 49, who also serves as chairman. "About 80 percent of my time is spent here."

He describes his commitment to the Suns as more about being accessible and available to attend various functions, citing a recent golf tournament that raised money for Phoenix Suns Charities.

"It's not so much about the day-to-day responsibilities, like I have here," he said.

Sarver's bank responsibilities have kept him busy lately. Stung by the recession and real-estate slump, the company has been unprofitable for the past three years. It lost $10.8 million, or 17 cents a share, during the fourth quarter of 2010, although that was much better than the year-earlier loss of $26.9 million, or 41 cents a share.

Western Alliance responded to the challenges by raising more capital. This included the sale of $48 million in stock at relatively depressed prices last year, along with the issuance of $74 million in high-yield bonds.

It also received $140 million from a sale of preferred stock to the government through the Troubled Asset Repurchase Program. The company plans to repay the money over the next 24 to 36 months, while paying dividends in the meantime.

"The government gets 5 percent after tax, so it's a pretty good return on its money," Sarver said of the TARP dividend payments the firm makes.

Western Alliance shares, which trade on the New York Stock Exchange, closed Wednesday up 10 cents, to $8.27, near the low end of their five-year range of between roughly $3 and $39 a year.

Turning the corner

Despite the challenges, Sarver senses the worst is over in several respects.

He said the banking industry has stabilized, and he thinks the Arizona real-estate market has hit bottom.

"We're definitely seeing more buyers than a year ago," said Sarver, who also founded and is an investor in Southwest Value Partners, a 25-year-old real-estate investment firm that has bought 30,000 residential lots in Maricopa County over the past three years.

Also, Western Alliance's loan portfolio has improved, with non-performing assets, loan charge-offs and credit losses all easing.

Sarver senses the Arizona economy has started to heal, basing that observation not just on improving statistics such as retail sales but also on conversations with bank employees and customers.

He spends about three days a week visiting Western Alliance offices in Arizona and the other states where it operates: California, Colorado and Nevada.

"I spend a lot of time on the road visiting branch managers and customers," he said. "My sense is that small-business owners are feeling more optimistic."

Western Alliance moved to Phoenix late last year, and large "Alliance Bank" signs recently were installed on the CityScape tower that is now the company's headquarters.

On game days when he's in town, Sarver walks to the arena.

"It's convenient and nice having two businesses so close together," he said.

Local banking

Western Alliance's move to Phoenix was prompted by Arizona's population growth and by an opportunity to expand its banking presence here, he said.

Western Alliance employs 1,000 people, including 212 in Arizona, primarily in its Alliance Bank of Arizona subsidiary.

He took a poke at the three giant banks that dominate in Arizona by saying he feels locally based institutions are more inclined to meet the credit needs of local customers.

"If your market is Arizona, you're forced to lend in Arizona," he said.

Ironically, Western Alliance last year consolidated and centralized its operations in a move that, observers say, could make the firm a bit less flexible and responsive to customers.

"This would allow the bank to cut costs and improve its efficiency," research-firm Morningstar Inc. wrote in a recent report. "However, we are concerned that these changes will cause senior managers who enjoyed the fairly decentralized structure to leave the firm."

Morningstar suggested Western Alliance might become less flexible and personal under the new model.

Community support

With Western Alliance now in Phoenix, Sarver and other top executives are becoming more involved with groups such as the Greater Phoenix Economic Council and Arizona Bankers Association and non-profits such as the Children's Museum of Phoenix.

Sarver said he is personally interested in supporting education, especially for young kids, and jobs.

"Those are the two biggest things we can do to improve this state," he said.

Sarver and his wife, Penny, also donated to the Sarver Heart Center at the University of Arizona, named in honor of his father, Jack, a hotel and savings-and-loan executive who died of heart disease in 1979 at age 58.

Robert Sarver recalls an era as recently as the 1980s when Arizona banks and S&Ls, prior to several high-profile failures and acquisitions, played a much more prominent role in the community. He founded National Bank of Arizona in 1984 and served as president until its sale to Zions Bancorp. in 1994.

Sarver hopes to develop a similar local presence for Western Alliance.

"We see this as an opportunity to build a premier local banking institution in this state," he said.

by Russ Wiles The Arizona Republic Apr. 7, 2011 12:00 AM




Banker's hours