Commercial Credit, a financial services firm founded in Baltimore in 1912, is exploring the possibility of moving its headquarters operation to surrounding counties, according to the chairman of its parent company.
"We are in the process of looking for new space," said Sanford I. Weill, chairman and chief executive officer of Primerica Corp. "As of right now, that search is confined to the confines of the state of Maryland. Whether it ends up in Baltimore or Baltimore County or one of the other counties, we can't tell you yet," he said in a recent interview. "But we are pretty close to making a decision."
Commercial Credit's lease at 300 St. Paul Place, where it rents about half the building and has about 400 workers, expires June 30, 1993. Built in 1957, the 20-story building had been owned by Commercial Credit until sold in 1989 to Fidelity & Deposit Co. of Maryland.
A Primerica spokeswoman said the options being studied by the company include renegotiating its lease at the building, leasing other space, or building a new structure.
Whether the company stays in Baltimore will depend on "whatever makes sense to our company from a financial point of view and a people point of view," Weill said. However, he said the firm is dedicated to Maryland and the Baltimore region.
"We are not leaving the area," Weill said. "We will be in the commuting range of where our people live now."
Weill was in Baltimore earlier this week to mark the fifth anniversary of the successful spinoff of Commercial Credit as a publicly traded company from its former parent, Control Data Corp. Then in 1988, Commercial Credit bought Primerica Corp., a diversified financial services company. The parent com
pany took the name Primerica while Commercial Credit continued as a consumer lending operation based in Baltimore.
The Commercial Credit venture was the second effort by Weill to build a national financial services firm. His first company, which he started in 1960, is now known as Shearson Lehman Brothers.
"Commercial Credit has really grown over this five year period to be one of the really leading companies in the consumer finance business," Weill said. During that time, the amount of loans has more than doubled from about $2 billion to about $5.5 billion and earnings have jumped from $27 million in 1986 to more than $170 million this year.
The main engine of Primerica's success has been the performance of Commercial Credit, which makes unsecured consumer loans and second mortgage loans to working-class consumers. Rates on these loans range from 14 to 21 percent.
In fact, some analysts say the company would have been better off without taking on the Primerica operations, such as the stock brokerage firm of Smith Barney, Harris Upham & Co. and Primerica Financial Services, formerly called A.L. Williams.
But Weill pointed to Smith Barney's recent third-quarter earnings, which increased threefold to $35.9 million -- more than the brokerage has earned in any full year of its history. "It's really becoming a leader in its business," he said.
He conceded that Primerica Financial Service has suffered since the departure of its charismatic leader, Arthur Williams, who left about a year and half ago under the cloud of an investigation by the Jacksonville, Fla., U.S. attorney's office.
"It takes time for people to adjust," Weill said. But he is confident that the new head of the division, Peter Dawkins, the one-time Heisman Trophy winner as college football's best player, will do a "very good job."