🔒TD Bank pursues growth strategies in a mature market

Despite retrenching its New England wealth management business in 2011, TD Bank remains committed to the region and to Maine, the bank's new regional president for Northern New England and Upstate New York told Mainebiz in a recent interview. David Glidden says the Toronto-based bank recently came full circle by once again bringing a broader wealth management operation to the region and hiring more than 27 people for it in Maine. Last fall, it extended its lease in the Bates Mill complex in Lewiston, where it has back office operations employing about 800 people, till 2025, and in April it said it planned to hire close to 100 more people for its call center in Auburn.

Glidden, 51, who replaced retiring Regional President R. Scott Bacon late last year, formerly was market president for the Boston, Metro South and Rhode Island area. He talked about his vision for the bank in northern New England, and more specifically, in Maine. An edited transcript of the interview follows:

Mainebiz: What does your new role entail? How do you interact with Maine market President Larry Wold?

David Glidden: I'm the regional president for TD Bank for Northern New England, which comprises all the banking operations for Maine, New Hampshire, Vermont and upstate New York, basically Albany through the Great Lakes region. I have three market presidents that report to me, so Larry, Steven Webb in New Hampshire and Philip Daniels for Vermont and upstate New York. My responsibilities entail all the retail, commercial, small business, government and general banking operations for the bank in that geographic region. So Larry as a market president for the state of Maine represents the bank and is the face of the bank for Maine. He also operates as the senior commercial lender and manages the commercial lending and small business groups, which are the primary functions of a market president.

MB: How did you get into banking?

DG: I don't think anyone wakes up and says 'I want to be a banker.' I grew up in Massachusetts, graduated from Providence College and was actually a prison guard in Massachusetts. I worked in a couple of other positions, primarily in sales, and through a circuitous route went into banking. I started in Boston with Shawmut Bank. I've been with TD Bank for almost 20 years now.

MB: What is your vision for northern New England?

DG: The northern New England, upstate New York market is a critical one where we have the No. 1 market share [by deposits] in Maine and a large share in the other markets. New England is the first market through which TD Bank Financial Group entered the United States, via the Banknorth legacy franchise. So clearly they're mature markets. But we enjoy large market share and they are a very profitable part of the bank. In Maine alone we have over 3,000 employees, a contact center and one of our major operations centers, so it's a very important part of TD Bank's U.S. franchise. We don't see that changing at all. We're completely committed to the market.

MB: In 2011, the bank transferred several dozen jobs from Vermont, New Hampshire and Portland to Cherry Hill, N.J., as part of a downsizing of the TD Wealth operations in northern New England. Is there a move within TD Bank to shift more high-end banking services to New Jersey?

DG: Actually, [in early June] we rolled out a new wealth management platform and we recently hired a couple new wealth management professionals in northern New England. We didn't [in 2011] have the capabilities and the investment platform that we thought we needed, so there was a bit of a retrenchment. Over the past 18 months, we've built out the back room, the investment platform and the products. We've actually been hiring from Maine to Florida a lot of wealth management and private banking professionals and getting them licensed. We've hired financial service representatives, about 27 just in the state of Maine, who are licensed to sell financial products. Another 13 are in training.

MB: Also in 2011, TD Bank announced it was committed to growing its total loans to small businesses over the ensuing three years. What progress has been made, notably in Maine?

DG: From a percentage standpoint we've been growing the commercial loan book, which is small- and medium-sized businesses, by 6%-8% the past two years, and we're on that track to do that again this year. That's in terms of the number of loans and dollar value. Last year we were the No. 1 Small Business Administration lender in Maine, New Hampshire and Vermont. We went from the No. 17 SBA lender to No. 7 [in the country]. In this region, and the bank as a whole, we continue to grow our commercial and retail market share.

MB: Where does the decision-making lie for local loans?

DG: All our decisions get made locally. As regional president, I, with other people in the region, am responsible for making all the loan decisions. It could be done in a local area of Portland based on the loan size. Very often it can be [made with the person sitting across the table]. It depends on how large the loan is. We think one of the critical things you have to do as a bank is make those decisions locally.

MB: TD Bank's CEO Ed Clark said recently that he has to assume interest rates will not rise soon and the bank will face downward pressure on margins for at least another year. He also said the bank is focusing on more permanent cost reductions. Where do you see that belt-tightening impact in northern New England?

DG: I don't think anybody expects rates to increase over the next couple years. We're always looking for where we can be more productive and where we can cut expenses and do things more efficiently with the same resources we have today. There are no major plans [for belt-tightening].

MB: Will Maine see some of the planned 30+ new branches in 2013?

DG: We typically open 30 de novo [branches] a year. There's none planned for northern New England the remainder of this year or into 2014. We look to do those in markets we're not in, or markets we're in but where we don't believe we have adequate coverage. A lot of those [branches] are being opened [over the next three-to-five years] in the greater Boston area, Rhode Island, New York City, Florida and Washington, D.C. In a market like northern New England that's mature and where we have good regional distribution and coverage, it really becomes an ongoing optimization issue. We recently finished [upgrading] our ATM system throughout northern New England. We'll be doing some renovation work on our location at 1067 Union St. in Bangor.

MB: Do you expect more acquisitions?

DG: Our core model is one of organic growth. When it comes to acquisitions, we don't have anything currently planned. But if an acquisition were to present itself and we thought it made financial sense, we would certainly look at it.

MB: The real estate market for homes is on the rebound. How is the commercial lending market faring?

DG: We're at historic interest rates for loans. Most of the banks have healed their balance sheets and everybody is out there aggressively looking for loans. I would say the biggest challenge from a competitive standpoint is that there is not as much loan demand as probably all of us bankers would like to see. Even though the economy is recovering, it's moving very slowly. Companies continue to do well financially in their own businesses and industries and are paying down debt. We're outperforming the industry as far as loan growth, but overall, loan demand is not as strong. And that really emulates the business owners themselves, because they're cautious about taking on new debt onto their balance sheets. But there's a lot of pent-up demand at their end. There's only so long you can go without buying that new machine or without making a capital investment to fulfill your customer's needs.

MB: In such a tough climate, are you doing anything special to attract borrowers?

DG: One of the advantages we have is our banking model and our retail franchise. We're open seven days a week. We're open extended hours. If you're a small business owner, that convenience, those extra hours, free coin counting, having the drive-ups open and the [branches] open on weekends and later hours when they're available [makes a difference].

MB: How would you compare TD Bank today with its original version, Portland Savings Bank, which opened in Portland in 1852?

DG: There's been a lot of consolidation through a couple different economic cycles. The sophistication of products and technology has changed. But the flip side of that is that in many ways, the business of banking hasn't changed. It's a very personal, people-driven business. People still want to sit down and have a relationship with a banker when they want a residential mortgage or a personal or small business loan. I think there will be further consolidation of banks. The headwinds, the margin pressure and the regulatory burden that's on all the banks is very significant. It will be very difficult for smaller banks to keep pace with the level of investment that you need to stay up with regulatory requirements.

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