Midwesterners are coming to Orange County.
Detroit-based Comerica Inc. has been shifting a big chunk of its operation to California from Michigan where the Big Three automakers are struggling.
Orange County is a focus for the bank, with key executives and divisions already here and more branches planned.
“They are in the process of shuttering branches in Michigan and putting their investment dollars in California,” said Manuel Ramirez, banking analyst with Keefe, Bruyette & Woods Inc. in San Francisco.
The bank employs about 150 people in Costa Mesa, where Comerica has planted a flag for international finance for the entire bank.
Comerica recently opened a Shanghai office that is managed out of Costa Mesa.
The Costa Mesa office also handles Southern California commercial real estate, small business banking and corporate training.
And Comerica’s Southern California office for retail banking also is in Costa Mesa.
OC is sharing Comerica’s California push.
Los Angeles soon will get a boost when Comerica consolidates its entertainment group in Century City in December.
A unit focused on lending to medical technology companies is based in Palo Alto with a branch office in OC.
Comerica’s nationwide branches are expected to grow to 512 in four years from 378 now, with California growing from 16% to 25% of the total.
More branches are planned for OC, according to J. Michael Fulton, president of Comerica’s Western banking operations in San Jose.
Comerica now has six OC branches.
By 2010, Comerica expects to grow branches by 35% with half coming outside of Michigan.
“I’d say the Midwest is going through a real downturn and it might be a sustained downturn,” Fulton said. “Clearly, if the company is going to grow and meet expectations and meet growth through deposits and earnings per share targets, it’ll be through the growth markets.”
Comerica is luring its brightest bankers out of the Midwest to help in other regions.
Chad Fietsam is taking advantage of an employee recruitment program that encourages workers to leave the Midwest.
“This is a professional opportunity to work in Comerica’s fastest-growing market,” said Fietsam, who is moving his wife and three kids from Troy, Mich., where he grew up, for a job as senior vice president for middle market lending in Comerica’s Long Beach office.
The office oversees commercial lending for companies with sales of $10 million to $300 million a year, including in OC.
Fietsam said he learned about the job through Comerica’s “Bank Without Borders” program.
“We use carrots, like down payments on homes,” Fulton said on how the bank gets folks to move.
The changing auto industry, which earlier drove Comerica’s growth, factored into Fietsam’s decision, he said.
“If you look at domestic auto suppliers that we have with Comerica, they will continue to thrive,” Fietsam said. “But the lower-tier suppliers are disappearing.”
Fietsam said he plans to buy a house in Irvine or Huntington Beach.
California Push
Founded 150 years ago, Comerica came to California in 1991 with Fulton moving here from Detroit to handle its first acquisition in the state.
Comerica’s move into California was the result of a strategy hatched in the 1980s to set up outposts in the Sunbelt, as Michigan’s population dwindled.
The company came to Texas in 1988 and Florida two years later.
When California passed legislation opening up banking here in 1991, there was widespread speculation that New York banks would rush to buy up Golden State banks.
Instead Comerica was among the first to show interest.
That’s when Comerica bought two specialty business banks: Plaza Commerce Bancorp in San Jose, and InBancshares, parent of Bank of Industry in City of Industry.
At the time, Fulton had been with Comerica for 20 years and stationed at its Detroit offices. He came to California to oversee the bank’s initial acquisitions here.
Fulton keeps offices in San Jose and El Segundo.
The expansion in OC is taking off.
Two years ago, Comerica had two branches in OC. In August, it opened its sixth in Irvine with more planned for Lake Forest, Huntington Beach, Foothill Ranch, Anaheim, Tustin and other spots.
“At the end of first quarter of 2007, we’ll have a dozen branches,” Fulton said.
Trammell Crow Co. real estate brokers are knocking on doors trying to find branches, he said.
“Orange County is one of our fastest-growing markets,” said Dan Kawamoto, executive vice president of personal financial services for Comerica’s Western market, who’s heading up the branch search.
Fulton, who speaks Mandarin, said Comerica is targeting ethnic neighborhoods. It’s hoping to penetrate the heavily Vietnamese-American area in Garden Grove and Westminster and Hispanic neighborhoods here and elsewhere.
“We’ve done six acquisitions here (in California). We may do more,” he said.
