Toronto-Dominion Bank's U.S. chief executive said an adverse court ruling has forced the company to change the name it planned to give its U.S. banking arm after the recent merger between Commerce Bancorp Inc. and its TD Banknorth Inc.
After closing the deal in March, the $437 billion-asset Canadian company announced it would name the combined company TD Commerce Bank and that it planned a major marketing push this fall to publicize the name. But TD Bank CEO Bharat Masrani said in an interview Wednesday that a federal court has ruled it cannot use the Commerce name on signs and marketing materials in certain Massachusetts counties because it would impede a local bank with a similar name.
Commerce Bank and Trust Co. in Worcester, Mass., said that letting TD Banknorth use the Commerce name would confuse its customers. Commerce Bank and Trust chief executive officer Brian Thompson said in an interview Wednesday that he is "pleased they respected our trademark. … It's good news because it eliminates what would have been a very difficult situation for us."
Mr. Masrani said he disagreed with the ruling and is "very disappointed" because the Commerce name has long been associated with "great customer service," particularly in New Jersey, where the company was headquartered, and New York. The company's own marketing research showed that merging the TD and Commerce names would draw the most customer attention, he said. But to appeal the court's ruling could lead to years of litigation, he said, and the post-merger bank could not wait the outcome of a long legal battle to begin marketing itself.
The new name instead will be: TD Bank, America's Most Convenient Bank, drawing on a tagline used by Commerce, Mr. Masrani said. The Portland, Maine, company will follow its rebranding timelines for the 1,100-branch U.S. network, he said. The new name is to be displayed on current Commerce Bank branches this fall and on TD Banknorth sites in 2009.
Vernon Hill 2nd, Commerce's founder and former chairman and CEO, opposed the merger with TD Bank, saying in February that when the company he created was absorbed by the larger TD Bank, Commerce's heavy focus on customer service would "slowly fade away." In an interview Wednesday, he called the dropping of the Commerce name "another step in the destruction of the Commerce model. To the customer, the name stood for something. Every step like this detracts from what Commerce was all about."