The Republican Party’s top bank, Chain Bridge Bancorp (CBNA.N), was valued at $138 million after its shares fell 2 percent in their NYSE debut on Friday, marking a dismal start to the initial public offering.
The IPO was relatively rare for the banking sector and came at a time when the market was dominated by new entrants from the technology and (link) biotech sectors (link).
While some analysts praised the timing of the IPO just a month before the presidential election (link), the lukewarm reception highlights the challenges of attracting investors to a lesser-known, conservative-leaning brand.
“More and more issuers are explicitly positioning themselves as conservative alternatives to the large incumbents,” said Angelo Bochanis, data and index associate at Renaissance Capital, citing firms like Trump Media & Technology Group DJT and Rumble 
RUM.
“However, Chain Bridge is not as consumer-focused as many of these companies.”
Chain Bridge’s fortunes are closely tied to the Republican Party, and the bank warns in its filings that any negative event impacting the party could result in significant deposit outflows.
“Chain Bridge is an economic company, but the main risks are non-economic,” said Joe Endoso, CEO of private investment platform Linqto.
Still, Endoso said the stock could trade well down the road given its potential appeal to Republican retail investors and its high asset quality.
“They’re targeting a group of people who don’t just want to make an investment, but want to make a statement. And that’s not a bad deal,” he said.
Chain Bridge has had no bad loans for 12 years, at a time when concerns about possible loan defaults have rattled many players in the banking sector.
The McLean, Virginia-based bank was founded by Peter Fitzgerald, the former Republican U.S. senator from Illinois. He retired in 2005 and was appointed to the Senate seat by former US President Barack Obama.
With just one branch and 84 employees, the company has prevailed against larger financial competitors and has become an indispensable partner for political work. She has worked with the campaign of every Republican Party presidential candidate since John McCain in 2008.
The bank’s shares opened flat at $22 per share before falling to $21.57. The bank raised $40.7 million in its initial public offering on Thursday and priced shares at $22, below its original target range of $24 to $26.