Irvine-based Commercial Capital Bancorp hired half of Comerica Inc.’s real estate services team in El Segundo last week as part of a major expansion of its commercial banking division.
Most of the 22 bankers from Comerica’s El Segundo office resigned as a group so they could rejoin their former boss who bolted a week earlier to start up Commercial Capital’s commercial banking unit.
The bankers provided escrow, deposit and credit services to Comerica’s title insurance and escrow clients, among others.
The talent grab is reminiscent of Commercial Capital’s formation in the late 1990s when the thrift hired 30 of H.F. Ahmanson & Co.’s Home Savings apartment loan underwriters to get Commercial Capital off the ground, said Mike McMahon, banking analyst with Sandler O’Neill & Partners LP in San Francisco.
“This is a very significant deal, and (Com-mercial Capital) is understating it,” McMahon said. “You don’t hire a corporate vice president and 20 people with the expectation to get (just) $100 million in deposits. For it to pick up this team, this is extremely beneficial to the company.”
Commercial Capital earlier hired James R. Daley, a former Comerica executive who ran the bank’s financial services division in El Segundo, to launch a similar business unit for the thrift.
“I’m done,” said Stephen Gordon, Commercial Capital’s chief executive, when asked if he had other hiring plans in the works. “We are pleased to announce that this premier group of commercial banking professionals has joined the bank.”
The move rattled nerves at Detroit-based Comerica, which said last week that roughly $8 billion of the bank’s $40 billion in deposits is managed by what the bank calls its financial services division from here in California.
Comerica’s Michael Fulton, president and chief executive of the institution’s Western market in California and Arizona, made phone calls to its top 20 clients during a recent weekend to assure them of Comerica’s commitment to the unit.
Last week Fulton was on a commercial jet to Denver to speak to some of its major title insurance clients, said Barry Holtzclaw, vice president in charge of the bank’s Western operations in San Jose.
“We have to rebuild some of our customer relationships,” Holtzclaw said. “(Fulton) wants to reassure them that we have the resources to meet their needs. This is an important division in our bank, and we want to keep it robust.”
Folks from far-flung parts of Comerica, including Detroit, were marshaled out to the Western division after the departures to keep things humming along, he said.
Escrow services make up the bulk of the work in Comerica’s financial services division. Comerica has multiple contracts with title companies to invest for short periods escrowed funds on homes that are in the process of being bought.
“It hasn’t hurt us financially but it’s expensive to work a lot of overtime on Friday night to sort this out,” Holtzclaw said.
The financial services division also handles wire transfers, management of U.S. Treasury bonds and other activities.
Holtzclaw didn’t rule out the possibility of litigation against Commercial Capital.
“The whole subject we are better off not talking about unless, or until, it happens,” he said.
There are about 165 Comerica employees in Orange County, 720 in Los Angeles County. Some 2,000 work in the bank’s Western market.
Comerica’s financial services group is known as a top national provider of deposit and loan services for title and escrow companies, property managers and tax-deferred exchanges.
Earlier this year, Commercial Capital boosted its deposits when it picked up a pair of tax-deferred real estate exchanges, Timcor Exchange Corp. and North American Exchange Co. Together, they contributed about $600 million in deposits to Commercial Capital.
Tax-deferred exchanges tap Section 1031 of the tax code to help investors avoid paying capital gains taxes on profits from other building sales. As long as investors use proceeds from one sale to buy another building within about six months, they can avoid a big tax hit.
This isn’t the only big hire that Commercial Capital has made recently.
In early July the thrift tapped Richard Grout to its newly created position of executive vice president and director in charge of retail banking.
Grout is the former retail banking head of Newport Beach-based Downey Financial Corp., where he was responsible for the thrift’s 170 branches.
Commercial Capital grew out of the wave of mid-1990s bank and thrift consolidation in California. At the time, the state’s economy was recovering from an early-decade recession that saw many banks fall into bankruptcy. Stronger ones were buying assets of struggling banks.
This was when Gordon and his friend, David DiPillo, Commercial Capital’s president and chief operating officer, decided to start a company that loaned money primarily to apartment building investors.
Commercial Capital nearly doubled its size last year when it bought El Segundo-based Hawthorne Financial Corp. for about $500 million. The thrift reported assets of $5.2 billion at the end of the second quarter, up from $4.7 billion a year earlier.
