As part of a full-court press in private banking, Crestar Financial Corp. says it will hire 60 relationship managers in the new year.
This would double its private banking staff, said Herbert E. Marth Jr., who runs the business at the $23.2 billion-asset banking company.
Richmond, Va.-based Crestar also plans to train at least 14 people to become private bankers in 1999.
The company, which manages about $2.5 billion of assets for affluent clients, planned the beefing up of its private banking staff in the wake of the entrance into Virginia and expansion of two out-of-state regional banking companies. Charlotte, N.C.-based First Union Corp. recently closed a deal to buy Signet Banking Corp., Richmond, and Wachovia Corp., Winston- Salem, N.C., just bought Richmond-based Central Fidelity Banks and Charlottesville-based Jefferson Bankshares.
"Three of our major competitors have disappeared within four months," Mr. Marth said.
Now, Crestar, which banks for wealthy people in Baltimore, Washington, and Virginia, is up against two bigger competitors.
First Union, which manages $30 billion of personal assets, employs 23 relationship managers in the mid-Atlantic states.
Wachovia, which manages about $32 billion of assets for individuals and institutions, is deploying 45 salespeople for private-client services in Charlottesville, Richmond, and Roanoke, as well as in northern Virginia and the Tidewater region. Before its acquisitions, Wachovia had one office, in Norfolk, Va.
Despite their arrival, Mr. Marth said, he is not worried about the North Carolina companies.
"That hasn't really changed our strategy at all," he said. Crestar is staffing up to keep pace with brokerage firms that are taking well-to-do customers away from all banks, he maintained.
As part of the planned push, Crestar is also asking executives like Mr. Marth to wear running shoes with their business suits. The idea is to "outrun the competition," Mr. Marth said, and his unusual apparel has already sparked questions and interest from customers and prospects.
The marketing gambit is "very serious," he said.
At Crestar, private clients must have net worths, excluding their primary residence, of more than $1 million, and they typically pay $10,000 per year in investment management and banking fees. The hope is that additional relationship managers will expand the clientele.
"This is a very affluent area, from D.C. down to Virginia," Mr. Marth said. "It is one of the highest-growth areas both in terms of population and economic activity."
Crestar used its data warehouse to determine that 32,000 of the bank's customers are affluent but that only a small percentage are served by the private bank.
Efforts to exploit such opportunities are becoming increasingly common as financial services companies seek to expand private-client groups, according to Norman R. Lubin, chief executive officer of FMS Consulting, a Blue Bell, Pa., firm that advises the investment management divisions of banks.
"What many private-client organizations today are doing is taking a look at the entire book of business" and assigning salespeople to pick up additional accounts, Mr. Lubin said. "They are segmenting their client base to identify which clients have the most upside opportunity."