BankAmerica Deal: More Public-Finance Muscle?
LOS ANGELES - BankAmerica Corp.'s acquisition of Security Pacific Corp. could help the companies' public finance efforts, market participants said.
A BankAmerica public finance official stressed that it is far too early to predict what might happen if the merger goes through. He added, however, that Bank of America would "welcome the opportunity" to review Security Pacific's existing public finance operation.
Last spring, San Francisco-based Bank of America expanded its public finance operation by hiring two investment bankers for a new Los Angeles office. Security Pacific is based in Los Angeles and already has clients in Southern California.
Richard A. Clark, managing director of public finance at Security Pacific, has primarily worked as a financial adviser recently. His clients range from Los Angeles to the Bonneville Power Administration.
Roderick Carter, a vice president of Security Pacific, specializes in school district financings. The firm also has two associates in public finance.
Bank of America's approach to public finance "is similar to ours," including an emphasis on retail business, Mr. Clark said. "I think it's a great opportunity, to be very honest."
Overlaps Not Yet Determined
The BankAmerica official, who asked not to be identified, noted that the same rationale that justifies the overall merger "also could hold true for public finance" by providing an expansion possibility. He added, however, that comments about future possibilities are premature.
BankAmerica, currently the nation's second-largest banking company, said on Monday it planned to acquire fifth-ranked Security Pacific in a stock transaction.
It remains unclear whether there is overlap between the banks' municipal operations that would result in layoffs. An investment banker at another commercial bank said yesterday that he believes the "core of each office could survive," based on existing business opportunities.
Security Pacific used to have about 10 professionals in its public finance department, a size similar to that of BankAmerica today. In late 1989, however, Security Pacific cut its investment banking staff in half.