Robert Steel plays banker again

Robert Steel speaks during the Wall Street Journal Deals and Dealmakers conference, in New York, June 11, 2008.

NEW YORK (Reuters) - Robert Steel, who was named deputy mayor for economic development for New York City last month, knows a thing or two about running banks.

He left a job as vice chairman at Goldman Sachs Group to become a top U.S. Treasury official during the administration of former President George W. Bush from October 2006 to July 2008. He went on to become chief executive officer of Wachovia, which a few months later was acquired by Wells Fargo.

Given that background, it's not surprising Steel is one of the many wealthy investors who are trying to get in on the bidding for failed banks taken over by the Federal Deposit Insurance Corp.

Steel was an early sponsor of CBC National Bank, a company formed last year that is seeking approval from the U.S. Office of the Comptroller of the Currency to buy failed banks. He is CBC's vice chairman. The company shares a mailing address with a private investment firm managed by Steel.

Earlier this month, Steel announced he was resigning from Wells' board, but he remains on CBC's board, a spokeswoman said.

CBC is one of a dozen or so companies that have submitted so-called shelf charter applications to become a national bank. The process was set up by bank regulators as way for private equity firms, money managers and other wealthy investors to bid on failed banks.

CBC, which intends to operate under the name Community Bancorp, submitted its application in January, according to a copy of the plan provided to Reuters by SNL Financial.

Steel, who did not return messages, isn't working alone. Other brand name bankers and financiers involved with the effort include former JPMorgan Chase CEO William Harrison, former Amegy Bank CEO Paul Murphy and Scott Stuart, founding partner of private equity shop Sageview Capital.

Sageview is going around to state pension funds trying to get them to commit money to CBC so it can begin bidding on failed banks once the company gets formal approval from federal regulators. Sageview, which gets a fee for its effort, hopes to raise $1 billion.

In April, Oregon Public Employees Retirement Fund became one of the first pension funds to invest in CBC, committing $100 million to the venture.

But it's not clear how well the effort is going. A spokesman for the New Jersey Investment Council, which manages the Garden State's public employee pension fund, said it decided not to invest in CBC.

(Editing by Jim Impoco and Claudia Parsons)