Pittsburgh-based Mellon Bank Corp. said it will consolidate the oversight of most of its West Coast businesses into one 59,000-square-foot building in downtown Los Angeles.
The move was viewed by analysts as a sign that Mellon was serious about competing in the region.
Mellon has 1,200 employees in California, Oregon, and Washington working in 13 different operations. The businesses range from insurance premium financing, shareholder services, corporate finance, and defined contribution services to commercial banking, equipment leasing, cash management, institutional investment management, mortgage banking, private asset management, mutual funds, master trust/global custody, and corporate trust.
Most of Mellon's corporate banking operations on the West Coast are geared to lending and other relationships with major U.S. corporations and middle-market companies. A company spokesman declined to disclose Mellon's West Coast assets, but said the bank has "several billion dollars" in commitments to locally based corporations. Mellon has $43 billion in total assets.
Eleven of the 13 businesses will be headquartered in the new Los Angeles office starting in January, the bank said. Mellon also plans to open a Palo Alto office to provide financial services to data processing and information technology companies.
The bank has 800 California employees. Initially, 100 workers will staff the new headquarters, according to Mellon spokesman Stephen K. Dishart.
Banking analysts said the creation of the headquarters, together with the move by Mellon vice chairman Keith P. Russell to Los Angeles in June, were both signs that the bank was anxious to exploit market opportunities on the West Coast.
"They've got a lot of corporate customers who do business out there and they see turmoil in that market" in the wake of Wells Fargo & Co.'s acquisition of First Interstate Bancorp, said Lawrence R. Vitale, an analyst with Bear Stearns & Co.
Mr. Russell, who was hired by Mellon in 1991, formerly served as president and chief operating officer of Glendale Federal Savings, one of the nation's largest thrifts and the main operating unit of Glendale, Calif.-based Glenfed Inc.
He had also been a senior vice president at Security Pacific Corp., now a part of BankAmerica Corp. Analysts said he brings to Mellon a detailed knowledge of West Coast markets.
Mr. Russell said that the office consolidation would provide better service for Mellon clients. "More important, it is another clear signal of Mellon's long-term commitment to the West Coast," he added.