Local office of Daiwa must close by Feb. Sale or liquidation compelled by U.S. ban in wake of cover-up

November 08, 1995|By Ellen James Martin | Ellen James Martin,SUN STAFF

The Daiwa Bank branch in Baltimore is expected to be liquidated or sold to another bank by February, according to Daiwa spokesman Mike Pascale.

The downtown Baltimore branch is one of 17 U.S. offices of the Japanese bank that has been ordered expelled by the U.S. government by Feb. 2, Mr. Pascale confirmed.

But he said the bank hopes that "appropriate extensions" to the Feb. 2 deadline might be granted.

The government on Thursday ordered Daiwa to close its U.S. operations. At the same time, prosecutors announced a criminal indictment accusing a senior Daiwa executive of directing a cover-up of $1.1 billion in bond trading losses.

"These are very unusual circumstances," said Louanne Baily, vice president and manager of the Baltimore office.

She declined to comment further on the nature of her office, how many people the small office employs or what will become of them.

Daiwa's Baltimore branch is in a plush suite in the W. R. Grace Building at 10 E. Baltimore St.

Its sole business has been to make commercial loans, principally to companies smaller than the Fortune 500, Mr. Pascale said. No deposits are taken at the office, he said.

Daiwa Bank currently employs just under 400 people in the United States and has had a presence in the country since 1966, Mr. Pascale said. He declined to say how many the Baltimore office employs.

The Baltimore branch was one of 15 purchased by Daiwa from Lloyds Bank PLC in 1990, the spokesman said. The others are in Atlanta, Boston, Chicago, Dallas, Houston, Los Angeles, Miami, Minneapolis, Philadelphia, Pittsburgh, St. Louis, San Francisco and Tampa. Fla. One of Daiwa's two New York branches, near Grand Central Station, also was purchased from Lloyds five years ago.

"There have been no specific plans offered for the branch offices," Mr. Pascale said Monday in New York. "Right now, the plans are being formulated. Nothing has been determined."

The pending closure of the Daiwa branch in Baltimore came as a disappointment to one area merchant, who served the company.

Rita Cooper, sales manager for Ginn's Order From Horder, an office supply store, said she has enjoyed having the bank as a customer for products ranging from legal pads to Post-It note pads.

"We're very sorry to see them go. We need businesses like that, and the city does, too," Ms. Cooper said.

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