ABN Amro Holding NV's expansion plans in the United States are more about perception than geography.
Though the Dutch banking giant is happy to keep its U.S. retail and commercial operations within the confines of the Midwest, it is planning to discreetly integrate the multinational ABN Amro brand into those operations.
Starting in October, both of its U.S. bank units, LaSalle Bank of Chicago and Standard Federal Bank of Troy, Mich., will adopt the ABN Amro logo. Both banks will retain their names, but a tagline, such as "part of the ABN Amro Group," will appear underneath or adjacent to the name.
Norman R. Bobins, the president and chief executive officer of LaSalle Bancorp, the holding company for ABN Amro's U.S. subsidiaries, said the move is designed to help attract corporate clients by showing the benefit of working with someone that has a multinational parent. At the same time, retaining the LaSalle and Standard Federal names will maintain the brand identity that consumers in the Midwest have known for the last 70 years, he said.
"The strategy we follow is to emphasize the fact that we are a local bank with local ties but with great global connections," said Mr. Bobins, who is also the chairman, president, and CEO of LaSalle Bank. Aligning the banks more closely with ABN Amro "allows us have a local identity and a global identity at the same time."
LaSalle Bancorp, with $105 billion of assets, is the 12th-largest bank in the United States, according to figures compiled by the Charlottesville, Va., research firm SNL Financial LC. That makes it slightly smaller than SunTrust Banks Inc. and National City Corp. and larger than KeyCorp, Fifth Third Bancorp, BB&T Corp., and Bank of New York Co.
LaSalle, with 130 branches in the Chicago area, has the No. 2 deposit share in Illinois, and Standard Federal, with 200 branches, has the No. 2 share in Michigan. They also have a network of corporate banking offices in five states that focus on middle-market companies.
The United States is one of three major centers for ABN Amro's retail and corporate banking operations, the other two being the Netherlands and Brazil. (It maintains trading desks and other operations in over 70 countries through its two other divisions: asset management and wholesale banking.)
But even though LaSalle also operates a nationwide mortgage lending business through the Internet and a network of brokers, Mr. Bobins, 60, says that, rather than expand to other parts of the United States, his challenge is to continue to build and solidify his company's holdings in the Midwest.
Because the United States is so much bigger than the Netherlands, which is barely twice the size of New Hampshire, LaSalle has chosen the Midwest as its "ballpark to play in," Mr. Bobins said. "The Midwest is a particularly attractive banking market, because it's got a strong work ethic and a good industrial base. There are plenty of opportunities here."
For example, even after all the consolidation of the last decade, Illinois is still home to more than 800 banks, and Mr. Bobins said he would like to expand his retail operations into Ohio and Wisconsin, most likely through smaller acquisitions.
"I am always looking at opportunities that help us round out the strategy we're following," he said. "We're good at putting the pieces together."
Norrie Morrison, an analyst with Natexis Bleichroeder Inc. in New York, said that ABN Amro's U.S. banking strategy seems the ones its uses in Holland and Brazil, where it focuses on establishing "home markets" and compiling a 15% market share in those markets. "That's what they've been trying to establish in the Midwest."
Though it has been successfully pursued this strategy in the United States, future earnings there have recently become a concern because of a number of factors, including the declining dollar, an expected slowdown in the mortgage market - which has generated "a huge amount of the business" - and bad-debt fears, he said. "In the end, all they're trying to do is run a profitable bank."
However, Mr. Bobins said that the ABN Amro affiliation will gives LaSalle and Standard Federal an edge in the United States, particularly with corporate clients. The international services available through its parent, such as 24-hour trading and "an excellent" foreign exchange operation, are "capabilities that very few banks our size can offer."
The corporate banking operation has offices in St. Louis, Des Moines, Milwaukee, Minneapolis, Indianapolis, Cincinnati, Cleveland, and Peoria, Ill.
Mr. Bobins acknowledges that the "hub-and-spoke" corporate banking strategy is copied from the airline industry. By using Chicago as a hub and the other midwestern cities as the spokes, it has access to a large portion of the region's businesses, he said.
All of the spokes are within a one-hour flight of Chicago, which most of the Midwest has historically looked to as its financial and urban capital, he said.
