Leadership shuffles again at First Foundation in Dallas

First Foundation Inc. in Dallas announced on Monday another shake-up of its leadership ranks.

The $12.3 billion-asset company said in a regulatory filing that Interim president and Chief Financial Officer Kevin Thompson had resigned. This followed news earlier this month from the parent company of First Foundation Bank that its then-president, David DePillo, had stepped down. 

The company said CEO Scott Kavanaugh would assume the role of president. It said Chief Accounting Officer Amy Djou would take on CFO duties on an interim basis while First Foundation conducts a search for a permanent replacement.

Kavanaugh has been CEO since 2009. Djou joined First Foundation in 2016 and has been the bank's top accounting officer since March of 2021, according to the filing.

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The company did not provide reasons for the changes, but analysts linked the moves to First Foundation's recent decision to pull back on loan growth as it adjusts to rising deposit costs and the industry at large braces for the specter of recession. The executives who resigned likely left to pursue growth opportunities elsewhere, analysts said.

The bank's total third-quarter loans nearly doubled from a year earlier to about $10.3 billion, but its deposits have not kept pace, growing about 40% to $9.5 billion, according to the company's earnings release. Kavanaugh said during a recent earnings call that growth would have to slow as a result. 

"This latest announcement does not look good optically, in our view, but we understand there were no disagreements and no accounting issues associated with the departure," Piper Sandler analyst Matthew Clark said in a report Monday. "We would not be surprised to see both David DePillo and Kevin Thompson land at other western banks in short order."

DePillo had been president of both the company and its bank unit since 2015. Thompson had been First Foundation's CFO since 2020. Before that he was CFO and treasurer at Opus Bank in California from 2017 to 2020.

"All in, we would expect shares to react negatively to the news given the second sudden and unexpected senior management departure in two weeks," Raymond James analyst David Feaster Jr. said in a note to clients Monday. "That said, we do not believe this was due to a strategic disagreement, but rather Mr. Thompson being recruited for another position. We do not anticipate any shifts in strategy or outlook for the company with Mr. Kavanaugh assuming the president role."