|By Francine Brevetti, Business Writer
Inside Bay Area
|Article Launched:07/18/2007 03:58:05 AM PDT|
|NINE MONTHS after acquiring Golden West Financial Corp., Wachovia Corp. executives say they’re mostly done with the work of merging the two companies and are looking to grow.The jobs Charlotte, N.C.-based Wachovia eliminated in its $25 billion acquisition of Oakland-based Golden West will come back slowly but surely, executives of Wachovia’s new Western division said. Meanwhile, company officials are also facing criticism from some who say the bank hasn’t been active enough in the community.Wachovia will open 25 to 30 branches in Northern California in 2008, bank executives Pete Jones and Robert McGee told MediaNews in an interview last week.”That number will grow considerably after 2008. It’s just a start,” said McGee, executive vice president and chief operating officer of Wachovia’s general banking group.”Each branch requires eight to 10 people,” added Jones, executive vice president of Wachovia’s Western banking group. Both banking groups are now based in Oakland.Wachovia, the nation’s fourth-largest bank, has said it would like to have 600 to 750 branches in California.
Wachovia eliminated 1,100 positions after it acquired Golden West Financial, parent of World Savings Bank, a deal announced in May 2006 and completed last October. Thirty percent of those jobs were in the Bay Area. Since the merger, 120 of the discharged employees have been hired back, McGee said.
McGee and Jones said the bank will actively hire and train additional bankers as it grows, and will add corporate-level positions to be based in its Lake Merritt offices in Oakland.
Focus on integration
The executives said the corporate focus over the past year was divided among integrating the two companies and staffs, and expansion in the West.
Officials have been readying employees for integration as a single company, Jones said, and grappling with choosing a new logo, which will be introduced in October.
Their West Coast expansion activities — planning for new branches — focused originally in Los Angeles and extended to Northern California in October. Wachovia has opened nine branches in Southern California in the last year.
In the meantime, Community Relations Executive J. Reymundo Ocanas, reassigned here from Southern California two months ago, has been meeting with a number of community groups and establishing relationships.
Still, officials with four prominent community groups complained they have not had enough contact with Jones and Wachovia Chief Executive Ken Thompson.
Last October, Thompson sent a list to community groups outlining the bank’s pledges to support low- to middle-income consumers in lending practices, philanthropy, small-business philosophy and other issues. The executives’ silence since then has left local leaders uneasy about the bank’s commitment to these promises.
“My colleagues at the state level Black Chamber of Commerce (in Sacramento) said they’ve never heard from (Wachovia). There is some concern,” said Len Canty, founder and chairman of the Black Economic Council in Oakland.
David Glover, executive director of Oakland Citizens Committee for Urban Renewal, said he was “disappointed” Jones and Thompson had not made more contact with OCCUR.
Last year, when Wachovia was trying to win the support of the Bay Area and Oakland, in particular, bank executives promised that local community leaders would have the opportunity to meet with Jones twice a year and Thompson once a year. Those meetings have occurred in the past year, McGee and Jones said.
Ocanas said the bank would attempt to expand its community outreach.
Alan Fisher, executive director of the California Reinvestment Coalition, and Robert Gnaizda, general counsel for the Berkeley-based Greenlining Institute, both expressed dismay that Wachovia is keeping the same model for mortgages to low- and middle-income families as did Golden West, specifically the so-called option adjustable-rate mortgage.
With these loans, the borrower can make a payment less than the interest payment but then the unpaid interest is added back to the principal owed.
“What are they doing to make sure Californians don’t get in trouble?” Fisher asked, referring to mortgage products that he feels are dangerous for the poor.
Defending the ARM
McGee said the bank’s option ARM was the highest quality such product on the market and amply protects the consumer.
McGee also said the bank is improving customer relations.
“We have less customer attrition in the first five months of this year than Golden West had in the first five months of last year,” he said.
The company is reinstalling ATMs, since Golden West was beginning to divest itself of them. It is offering a free checking account, with no service charges, no minimum balance and no direct deposit required. Also, it is expanding its offerings of certificates of deposits at competitive rates.