Mitsubishi's Yasumasa Gomi Under Pressure from All Sides
When Mitsubishi Bank Ltd. needed someone to fix its underperforming Bank of California unit in 1989, it turned to the man who had originally engineered the purchase of the San Francisco-based bank.
Yasumasa Gomi, 48, had supervised the deal as manager of the Japanese bank's international planning division in 1984. But following his appointment as Bank of California's chief operating officer and later its chief executive, Mr. Gomi has found that buying the bank was far easier than running it.
Fighting a Downward trend
Years of headlong growth, especially in the high-risk commercial real estate and leveraged-deal lending markets, have saddled Bank of California with high expenses, a shortage of core deposits, an inefficient branch structure, and a passel of bad loans. In the past three quarters, the $8.9 billion-asset bank has set aside special reserves of $250 million, turning a mediocre profit record into one plagued with losses.
Mr. Gomi "is under extreme pressure from U.S. regulators, the parent company, and even the Ministry of Finance in Japan" to turn Bank of California around, said a former senior executive of the bank.
Mitsubishi originally acquired Bank of California as an entree to the lucrative middle market in California, Washington, and Oregon, the three states in which the bank has branches. But the bank was lured away from its mission by the seemingly fat and easy profits of construction and leveraged deal loans.
Today Mr. Gomi is recasting Bank of California as the relationship-oriented, middle-market bank Mitsubishi wanted. "My instructions were to refocus on the original intention of the acquisition," he said.
At the same time, Mr. Gomi is tying Bank of California's operations more closely to its parent, reversing the bank's previous course of operating autonomously.
"Mitsubishi's U.S. strategy is directed by North American headquarters in New York. We play the role of the Western states arm of Mitsubishi," he said.
Still Adjusting to U.S. Business
Mr. Gomi is the consummate company man, a 26-year Mitsubishi veteran on his first overseas assignment. "My management philosophy is Mitsubishi's management philosophy," he said in response to a question.
A genial man, Mr. Gomi has nevertheless had a tough time communicating with his American management team, company insiders say. While his command of English has improved, he still speaks through an interpreter, and he remains in many ways an outsider.
"He's a fine person, but he has not gone through a Westernization process," said an executive who has worked closely with him.
Mr. Gomi says he is learning to appreciate some aspects of U.S. business culture, especially the efforts of managers here to balance work and family life.
Mitsubishi, too, is adapting as it becomes more sophisticated in understanding American-style banking. In Japan, banks have "hidden assets" - unrealized gains on securities holdings - to protect them from the ups and downs of the credit cycle.
"But in the U.S., Mitsubishi has learned that there is no cushion," Mr. Gomi said.