Maryland’s newest bank is getting ready to expand.
BlueRidge Bank in Frederick has plans to raise between $5 million and $10 million in capital this year in preparation of an eventual acquisition, according to Brian Gaeng, the bank’s president and chief executive.
The bank, founded during the Great Recession in April 2008, opened a commercial real estate lending office in Gaithersburg earlier this month. It is the company’s fifth location.
“Of all the counties in Maryland, the demographics in Montgomery County are very strong,” Gaeng said, adding that he plans to open a full-service branch in the area next year.
Much of BlueRidge’s lending is tied to the local commercial real estate market. Recent projects include the renovation of the Monocacy Valley Canning Co. building in Frederick. The bank’s average loan is between $1 million and $3 million, Gaeng said.
Last year, lending grew 19 percent to $144.23 million, while profits totaled $486,000. The bank has $178.67 million in total assets.
“The market is coming back,” Gaeng, 56, said. “You’ve got developers stepping up and taking speculative risks.”
BlueRidge now has 31 employees, including four new hires from Presidential Bank in Bethesda who work in the new Montgomery County office.
“We started, obviously, at ground zero,” Gaeng said. “Growth has been steady since then, but we’ve done it at a measured pace.”
As banks merge and consolidate, Gaeng says it has become easier to scoop up talented employees from area institutions. The executive vice president of the bank’s Baltimore office, for instance, came to BlueRidge following Capital One’s 2009 purchase of Chevy Chase Bank.
Like many of the bank’s executives, Gaeng spent much of his career at area community institutions, first as president of Fidelity Bank in Hagerstown and later as chief executive of Fredericktown Bank in Frederick, both community banks owned by Mercantile Bankshares.
When PNC Financial Services Group bought Mercantile in 2007, Gaeng and two partners decided to create their own community bank. The group raised $18 million from 250 local investors.
Now as BlueRidge prepares to raise a second round of capital, Gaeng says he hopes to eventually expand into the District and Virginia. The bank has existing locations in Baltimore, Hagerstown and Damascus.
“Clearly we are interested in being an acquirer,” Gaeng said. “We’ve stayed very true to our model, which is commercial real estate, and there is room to grow.”