BB&T Corp. recently went trawling for another retail brokerage acquisition, only to come up with an empty net.
Henry Williamson Jr., BB&T's chief operating officer, met several times in recent months with executives of Ferris, Baker & Watts Inc., a primarily regional brokerage headquartered in Baltimore that also has a small research and capital markets operation. The employee-owned firm is in the midst of an expansion beyond its roots in the Middle Atlantic states, opening offices in Michigan, Ohio, and BB&T's home state of North Carolina.
Baker, Ferris, which has 670 employees, has felt the same pinch as other brokerages during the recent downturn on Wall Street. The firm recently cut about 10 investment banking and research jobs and eliminated coverage of consumer retailers and vendors.
George M. Ferris Jr., the firm's chairman, said BB&T approached him, and he listened, but that the talks ended because he and Mr. Williamson could not agree on a price.
"We think that BB&T is a terrific bank, and there was a lot of synergism between our two organizations," Mr. Ferris said. "But basically, they didn't feel they could come up with a price that we felt was better than what we could do just continuing to run as an independent organization."
A spokeswoman for BB&T declined to comment. The company has bought several other small brokerages, most recently Edgar M. Norris & Co. of Greenville, S.C., in September.
Mr. Ferris insisted he is not seeking other buyers, especially at a time when brokerage valuations are depressed. Asked whether he would permanently rule out a combination with BB&T, he said: "We were very impressed with them. The door is never closed."
Profit from Tax Cut
Now that Americans have started getting their federal tax rebate checks in the mail, financial firms are thinking about generating their own windfall.
For example, Morgan Stanley Dean Witter & Co. is running full-page newspaper ads alluding to the "thousands extra for retirement" investors can get just by depositing those $300 checks in Morgan Stanley retirement accounts.
Business has certainly been slow on Wall Street this year, with brokerage customers wary of parking any more money in the stock market until things start to look more stable.
Sandy Weill, chairman of Citigroup Inc., said the IRS checks should give his company a boost. "We're planning as if times will be tougher," he said during a second-quarter earnings conference call. "We hope the tax cut will be helpful."
Jim Hance, the chief financial officer at Bank of America Corp., said basically the same thing during his company's earnings call: "The rebate checks should be a big help."
Not Leaving After All
Banc of America Securitiesmay have picked a new head of mergers and acquisitions this week, but it is not losing the man he succeeded.
On Tuesday the Bank of America unit said it had hired Anthony J. Magro away from Bear Stearns Cos. to be its global head of M&A. He succeeded Stefan Selig. A spokeswoman said at the time that Mr. Selig's future with the firm was uncertain.
Then there was a seemingly abrupt about-face. On Wednesday the company said Mr. Selig would stay at Banc of America Securities with the title of vice chairman. He will report to Mr. Magro and remain a senior banker helping with "development and execution of our M&A business," the spokeswoman said.
BancWest Pay Hike
BancWest Corp. bumped up by $150,000 the minimum salary it will pay its president and chief operating officer, Don G. McGrath, under the terms of its pending sale to BNP Paribas.
In a proxy statement filed this month with the Securities and Exchange Commission, the Honolulu company said Mr. McGrath has an employment agreement that entitles him "to a base salary of least $800,000."
In an earlier proxy statement for the sale to BNP, dated June 5, BancWest said it had an agreement with Mr. McGrath to pay him at least $650,000.
A spokesman for the company said the first proxy filing used information about Mr. McGrath's minimum salary from a 1998 employment agreement but did not reflect the automatic raises that kicked in as his take-home pay grew each year.
The Walnut Creek, Calif.-based executive already has surpassed his old minimum. Last year Mr. McGrath - who runs BancWest's mainland subsidiary, Bank of the West - took home a salary of $733,346 and a cash bonus of $450,014.
By David Boraks, Liz Moyer, and Laura Mandaro