History

CapitalSource was founded with a simple business plan: to be the leading commercial finance company in the United States focused on the needs of middle-market borrowers.

Today, CapitalSource is a leading commercial lender operating principally through our subsidiary, CapitalSource Bank. We offer senior debt in the form of loans, typically from $5 million to $100 million. Since our founding, we have been guided by a spirit of integrity, commitment, and discipline. We focus on smart growth opportunities designed to strengthen our lending platform, while providing long-term value to our investors.

Our Beginning

Our company finds its roots in 1993 when CapitalSource Founder, Executive Chairman and Chairman of the Board, John Delaney started HealthCare Financial Partners (NYSE: HCF) with $25 million of initial capital. Under Delaney’s leadership, HCF provided custom financing to healthcare service companies and went public within three years. HealthCare Financial was sold in 1998 as a half-billion dollar business—three times its IPO price.

In 2000, Delaney and Jason Fish, a partner at Farallon Capital Management, saw an opportunity within the banking industry for a broad-based, middle-market commercial finance company. Building upon the business model that brought Delaney earlier success, Delaney and Fish set out with an initial capitalization of over $500 million (at the time, the largest private capitalization for a finance company) to expand beyond healthcare lending to other focused industries and sectors. With a clean slate, optimal market conditions, ample capital, and an experienced management team, CapitalSource executed its business model emphasizing efficient execution, deep industry expertise, and uncompromising credit standards.

Going Public

In 2003 we completed our IPO and began trading on the New York Stock Exchange (NYSE) under the symbol, CSE. 2006 marked our conversion to REIT (Real Estate Investment Trust) status—a move that allowed us to remain competitive in a highly-liquid market due to the tax benefits of REIT status.

Strengthening Our Platform

Diversifying and strengthening our funding platform has always been a fundamental strategic goal for our company. In July 2008, we finalized the purchase of certain assets from Fremont Investment & Loan, a California industrial bank with approximately $5.6 billion in retail deposits and 22 retail banking branches. In the summer of 2008 we commenced operations of these branches under the name CapitalSource Bank, and in January 2009, revoked our REIT status. Our bank branches now stand alongside our commercial lending platform, and together, continue to work with the same foundation of discipline, integrity, and industry expertise.

Since inception, we’ve committed $28 billion in loans to over 1,600 customers. Looking forward, we aim to hold true to our core goals by continuing to provide custom financing solutions to our customers and strategically growing the company—creating long-term value—for our stakeholders.