Detroit's Comerica Inc. wants to take Manhattan.
The $35.4 billion-asset banking company has retained a New York headhunter to recruit six trust officers from local banks to staff a Manhattan office.
The move is a broadening of the bank's year-old alliance with PaineWebber Inc., under which the brokerage refers its affluent clients to Comerica's trust officers.
"We're not moving into New York as an unknown trust company, but as a partner with an established company with an enormous book of business," said David B. Stephens, a Comerica executive vice president who oversees its private-banking division. "It's not like hanging out a shingle and saying 'we're here' and nobody knows who we are."
Comerica plans to staff the office in 60 to 90 days. The office will be adjacent to a PaineWebber branch in midtown Manhattan, either on Park Avenue or Sixth Avenue.
Comerica already has trust people in several other markets - Michigan, California, Florida and Texas - where the alliance is under way. PaineWebber has eight branches in New York.
Comerica has $13.1 billion in personal trust assets under management, but its name probably won't ring a bell among the affluent on the East Coast. Nevertheless, the Midwestern bankers are excited about competing in the Big Apple.
The New York trust market is chock-full of resident stalwarts such as J.P. Morgan & Co., U.S. Trust Corp., Chase Manhattan Corp., Fiduciary Trust Company International, Bankers Trust New York Corp. and Bank of New York Co.
These institutions benefit from a flow of referrals by attorneys and accountants who cater to the city's wealthy.
"The likelihood of establishing themselves (alone) in this market is very low," said David B. Master, managing director of Optima Group Inc., a Fairfield, Conn.-based consulting firm. "But leveraging someone else's relationship shows a great deal of sensibility."
PaineWebber has 6,000 brokers around the country and regional alliances with 10 trust companies, including Comerica. Another alliance, with Bank of Boston Corp.'s trust department, is coming down the pike, according to industry sources.
While it manages $49 billion in trust assets, PaineWebber expanded its "wealth planning preservation program" to include outside fiduciaries for additional expertise, said John W. Emery, the brokerage's manager for personal trust services.
He said New York was selected as the fifth branch of the Comerica alliance because PaineWebber clients there asked for it.
The PaineWebber trust business is unusual, because many of its accounts are directed by the clients.
"The beneficiaries of the trust determine what investment option would be most suitable," Mr. Emery said. "That truly sets us apart from the competition, because we have flexible investment options."
