Bank of Montreal Park? Comerica Flailing. Selling Chatter Circulating

[Lowell]

Crain's Tom Henderson reports that Comerica is shaky, its stock holders up in arms and many calling for the head of CEO Ralph W. Babb Jr. While he got re-elected at the recent annual meeting he is on very thin ice to produce or even sell the bank. One of the rumored likely buyers includes the mighty Bank of Montreal.

As for Babb, I confess to a degree of Schadenfruede. After all it was he who kind of kicked us when we were down in 2007 by moving the 150 year + Detroit bank's HQ to Dallas. He was heading for the greener pastures of oil investment loans and now finds himself holding $689 million in non-performing frack-bust oil industry loans with 56% now at risk of default. Ironically healthy Michigan deposits and loans are largely responsible for floating him now while Texas withers.

[401don]

Toronto's MLS soccer team plays at BMO Field. Bank of Montreal uses the BMO [[pronounced B-Mow) acronym for marketing purposes. Not sure if BMO bought Comerica if or when they would dissolve the Comerica name.

[Onthe405]

Toronto's MLS soccer team plays at BMO Field. Bank of Montreal uses the BMO [[pronounced B-Mow) acronym for marketing purposes. Not sure if BMO bought Comerica if or when they would dissolve the Comerica name.

It's extremely doubtful BMO would use the full Bank of Montreal name in the States. The majority of US consumers & businesses are skittish in perceiving that "their" bank is ostensibly "foreign owned". I say "ostensibly" because, in terms of shareholders, many US-chartered banks have majority stockholders from overseas--but public perception is all in the name.

Toronto Dominion Bank already has a substantial presence in the US, but they understandably market themselves with names like TD Ameritrade and TD Bank Financial Group , which masks any obvious Canadian moniker.

Other US retail banks like HSBC [[UK) and Union Bank [[Japan) also don't have any obvious indications of their international origin in the name.

[hybridy]

they already a significant midwestern presence, thus a michigan expansion isnt that far fetched
https://en.wikipedia.org/wiki/BMO_Harris_Bank

[iheartthed]

It's extremely doubtful BOM would use the Bank of Montreal name in the States. The majority of US consumers & businesses are skittish in perceiving that "their" bank is ostensibly "foreign owned". I say "ostensibly" because, in terms of shareholders, many US-chartered banks have majority stockholders from overseas--but public perception is all in the name.

Toronto Dominion Bank already has a substantial presence in the US, but they understandably market themselves with names like TD Ameritrade and TD Bank Financial Group , which masks any obvious Canadian moniker.

Other US retail banks like HSBC [[UK) and Union Bank [[Japan) also don't indicate their international origins in the name.

When Santander bought Sovereign Bank they rebranded the SBs as Santander.

[Detroit500]

Comerica bet against Michigan and lost... I will never forget their treachery.

[SammyS]

It's the Texas 80's oil bust redux. This reminds me of all that chatter over past 15 years on how all of Michigan's wounds were all self inflicted. "Build a better car and we'll buy it" they claimed while they were high on HELOC and more recently, oil fumes. No, a nations financial health is built on productivity, not credit and oil bubbles. To Texas, I say suck it.

[Baselinepunk]

Fuck Texas with a capital F U C K.

[Scottathew]

I had an auto loan I just paid off from Harris Bank of Chicago, which during the loan was acquired by Bank of Montreal. They now call it BMO Harris Bank [[pronounced Bee-Mow Harris).

[Wesley Mouch]

Comerica bet against Michigan and lost... I will never forget their treachery.

Corporations often seek the short-term gains. They got their short term. Now they're seeing the long-term.

[Onthe405]

It's the Texas 80's oil bust redux. This reminds me of all that chatter over past 15 years on how all of Michigan's wounds were all self inflicted. "Build a better car and we'll buy it" they claimed while they were high on HELOC and more recently, oil fumes. No, a nations financial health is built on productivity, not credit and oil bubbles. To Texas, I say suck it.

Personally, I'm scarcely a TX fanboy. However, to be fair, the boom in the oil capital market [[accompanied by cheap land & low taxes) has attracted & created other jobs in semi-related or unrelated industries that will have longer lasting economic benefit for TX and the nation [[the Austin tech sector and Toyota moving their US operations out of CA are a couple quick examples).


This is really no different than the "ripple" economic benefits provided to MI by the auto industry, such as innovation in manufacturing practices, robotics, & battery technology. Even unrelated industries like retail [[Kmart) and fast food [[Domino's) were birthed in MI because of its large economic cross-section population of middle-class consumers. I would agree that financial health is built on "productivity"---but would also add "perpetual innovation".


For good or bad, it's pretty obvious that there's an element of geographic economic ascent & decline inherent within the harsh cycles of capitalism. Yes, people and jobs will continue to flock to TX & FL----until they become too polluted, too crowded [[un-affordable real estate & increased demand for social services resulting in higher taxes), and natural resource supplies are threatened or exhausted. Then another place will be crowned as the newest paradise of prosperity & opportunity.

[iheartthed]

Personally, I'm scarcely a TX fanboy. However, to be fair, the boom in the oil capital market [[accompanied by cheap land & low taxes) has attracted & created other jobs in semi-related or unrelated industries that will have longer lasting economic benefit for TX and the nation [[the Austin tech sector and Toyota moving their US operations out of CA are a couple quick examples).


This is really no different than the "ripple" economic benefits provided to MI by the auto industry, such as innovation in manufacturing practices, robotics, & battery technology. Even unrelated industries like retail [[Kmart) and fast food [[Domino's) were birthed in MI because of its large economic cross-section population of middle-class consumers. I would agree that financial health is built on "productivity"---but would also add "perpetual innovation".


For good or bad, it's pretty obvious that there's an element of geographic economic ascent & decline inherent within the harsh cycles of capitalism. Yes, people and jobs will continue to flock to TX & FL----until they become too polluted, too crowded [[un-affordable real estate & increased demand for social services resulting in higher taxes), and natural resource supplies are threatened or exhausted. Then another place will be crowned as the newest paradise of prosperity & opportunity.

I don't think this answers why Comerica needed to be in Texas. The answer to that question is that it didn't. Regional banks usually move from originating cities to financial centers and that is usually due to mergers/acquisition. Since Dallas is not really a financial center it was odd for a well established bank to uproot itself and relocate there.

In theory, the oil boom in Texas should have created opportunity for the local banks in that area to grow. If the local banks couldn't fill that void then Comerica could have done that from Detroit, just like the New York banks do for the rest of the country.

[BankruptcyGuy]

Let's just say there isn't a ton of sadness within the banking community, many of whom were former employees who had to choose between company and hometown.

[Jason]

iirc from the threads here about it when it happened, it was found that they moved to Dallas basically because the families of the board or the president or someone wanted to personally move to Texas. So the move wasn't all business, it was personal too.


Also, Dallas is twice as far away from Detroit as Montreal is... so... half way back home.

It would be cool if Detroit had a major bank again but unfortunately that's no longer possible in today's banking world.

[401don]

Let's just say there isn't a ton of sadness within the banking community, many of whom were former employees who had to choose between company and hometown.

Still, I'd be more concerned for the roughly 9,000 employees still working in Michigan. Buyouts rarely lead to more jobs.

[Hypestyles]

Break up the big banks. Start lending to everyday folks.

[MikeyinBrooklyn]

Issues of Texas, taxes, and oil aside, I am not certain that whoever [[if anyone) buys Comerica will get naming rights. Almost certainly there is a clause in the contract that would allow Olympia an opt-out if Comerica changes hands or names. I suspect that much like the Pentagon having contingency plans to go to war against anyone, Olympia has a plan of action should the need arise to rename Comerica Park. They might have another sponsor waiting in the wings [[my vote, were it to get a new corporate name, is Meijer Park), or revert to something like "Tiger Ballpark" [[the announced name when the stadium design was first shown to the public) pending a name change.

[Gistok]

This thread reminds me of this old thread from 9 years ago.....

http://www.atdetroit.net/forum/messa...tml?1173960666

[SDCC]

If investors are angry they’re not showing it; the stock has been on an upward trajectory since hitting its low in February [[52-week range). Comerica’s one-year range is a low of $30.48, to a high of $53.45. Currently Comerica is trading at the upper end of its 52-week range

Comerica is certainly not a heavy hitter in the banking industry, it has a market capitalization of ~ 8 billion. For comparison: Wells Fargo ~ 250 billion, JP Morgan Chase ~ 235 billion, Bank of America ~ $150 billion – all figures are market capitalization.
The big banks are still fat from acquiring failing, or financial institutions that were severally affected by, the financial crisis of 2008. Which was caused by the institutions greed, purposefully complicated transactions, and a lack of Federal oversight. Much has changed; there are “Stress Tests” and there is something referred to as a banks “Living Will”. However, despite these new and refined regulations, 5 of the 8 big banks failed their last stress test evaluations.

The Crain’s Detroit article leans on an article that was written by Dick Bove; who is [[as stated in the article) the vice president of equity research at New York-based Rafferty Capital Markets LLC. Not mentioned is, Bove also authored the book "Guardians of Prosperity: Why America Needs Big Banks" [[2013).
Additionally the article is a good one , it sites several reliable sources. And investors could be hoping merger whispers are true, as the current stock price is ~ $46.00 a share is near its 52 week high. Investors may perceive a purported buy-out or merger as positive news. The majority of investors are institutions and mutual funds.

[Hermod]

It's extremely doubtful BMO would use the full Bank of Montreal name in the States. The majority of US consumers & businesses are skittish in perceiving that "their" bank is ostensibly "foreign owned". I say "ostensibly" because, in terms of shareholders, many US-chartered banks have majority stockholders from overseas--but public perception is all in the name.

Toronto Dominion Bank already has a substantial presence in the US, but they understandably market themselves with names like TD Ameritrade and TD Bank Financial Group , which masks any obvious Canadian moniker.

Other US retail banks like HSBC [[UK) and Union Bank [[Japan) also don't have any obvious indications of their international origin in the name.

Royal Bank of Canada bought Centura Bank and uses RBC-Centura on their banks in the US.

[Hermod]

Break up the big banks. Start lending to everyday folks.

Any bank will be glad to give you a loan IF you have decent credit. I don't need to borrow money, but every bank I go into has signs all over the place encouraging people to take out loans and I get plenty of ads in the newspaper and junk mail. The problem the banks have is not enough QUALIFIED people are borrowing money.

[MikeyinBrooklyn]

Any bank will be glad to give you a loan IF you have decent credit. I don't need to borrow money, but every bank I go into has signs all over the place encouraging people to take out loans and I get plenty of ads in the newspaper and junk mail. The problem the banks have is not enough QUALIFIED people are borrowing money.

Often forgotten. Banks WANT to loan you money, including the "everyday folks." But you need to have an income & credit history that justifies the loan. Giving a loan to someone who can't make the payments is an awful thing to do to someone. Screws them up financially much worse than had they not been able to get a loan.

[SDCC]

Often forgotten. Banks WANT to loan you money, including the "everyday folks." But you need to have an income & credit history that justifies the loan. Giving a loan to someone who can't make the payments is an awful thing to do to someone. Screws them up financially much worse than had they not been able to get a loan.

That is exactly what occurred, and contributed to, the 08 meltdown. Insufficient credit, poor FICO scores, and no [[or little) down payment were shrugged off.
One example: Countrywide Financial - who settled for $355 million with its victims - for its widespread discriminatory practices against qualified African-Americans and Hispanic borrows. Their actions contributed to the housing crisis, hurt entire communities, and denied families across America access to the American dream - a place they could call home.
Countrywide was sold to Bank of America for $4.1 billion.

[3WC]

I have dealt with many banks over the years, including Comerica starting when it was Detroit Bank & Trust. It degenerated from a very good bank to the worst one I have ever dealt with.

I was a shareholder for several years and a customer for probably 30 years [[in MI and TX.) There were probably a few justifiable reasons to move to TX at the time; actually it became the largest bank in TX HEADQUARTERED there. That's because every major bank in TX failed in the later '80s as a result of the '86 energy crash which resulted in every major bank being acquired by non-TX banks.

Comerica after it moved to TX didn't have a clue about the energy business. It ignored the mistakes made by TX banks in the '80's and plunged headlong into energy lending. I am in the business in TX and everybody was amazed at the dumb deals they were making to gain market share. Ignorant, ignorant people. Everybody connected to Comerica, shareholders, management, and non-energy customers deserve what's happening now as a result of the terrible decisions made during the last few years. Bye bye Comerica.

[Bham1982]

Comerica's revenue, profitability and share price have all risen in recent years, and the bank is much healthier than when it was HQ in Detroit.

Is it's improved health related to the move? Doubtful. Probably just a function of the improved economy and lending environment.

Comerica's 5 year performance. Looks pretty solid to me.
https://www.google.com/search?q=come...AQAiQUDXDgAAAA