Wild and woolly, that is me,
Graziadio, sayeth he.
Calm and steady but much duller
Is the sober Eugene Miller.
Can these bankers work together
Without ruffling the other's feather?
That's the trick we wait to see:
A bank that lives in harmony.
Or will Imperial's stormy mien
Change Comerica's passive scene?
Wall Street waits in apprehension
To see Comerica's new dimension.

Merging cultures always is difficult. But none should be more so than the pending acquisition of Southern California-based Imperial Bancorp by Detroit's Comerica Inc.

The $7 billion-asset Imperial, whose chairman is 80-year-old George L. Graziadio Jr., has always been a sexy bank, with its stock price soaring and plummeting along with sharp changes in its fortunes. In contrast, the $41 billion-asset Comerica, whose CEO is the 62-year-old Eugene Miller, has been among the most conservative banks in the nation--a trait that goes back as far as the Great Depression, when most Detroit banks had been badly hurt when the economy tumbled.

The difference in styles is apparent in the two banks' earnings since the third quarter of 1998. Comerica's quarter-to-quarter earnings have grown steadily, rising each quarter except for the first quarter of 1999, when it matched the previous quarter's per-share net income. During that period, Comerica's earnings grew 28%, to $1.08 a share.

Imperial's earnings, in contrast, went through convulsions. The banking company reported a 7-cent loss in the third quarter of 1998 followed by a 37-cent profit in the fourth quarter of that year. Its profits continued to roller-coaster: up 19% in the first quarter of 1999, up 43% in the second quarter, down 25% in the third quarter and up 156% in 1999's fourth quarter. In the first quarter of 2000, earnings dropped 50%, and another 7% in the second quarter. In the third quarter, they rose 16%.

Unlike steady Comerica, Imperial tends to rush into all sorts of faddish businesses. In recent years, it has been lending to technology startups, which helps account for the bumpy earnings record. A significant part of its earnings comes from warrants it holds in companies to which it has made loans.

In recent years, Comerica also has ventured into lending to technology companies in Northern California, but its track record seems much more stable. Miller has said Comerica carefully combed Imperial's portfolio and said he was satisfied with it. He also acknowledges that Imperial's credit standards don't come up to Comerica's, but he expects they will. But will they?


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