Bank One to bring 500 jobs to city

Company's facility on Fayette Street set to open by Oct.

Banking

March 08, 2000|By June Arney | June Arney,SUN STAFF

Bank One Corp., the nation's fourth-largest bank holding company, plans to bring 500 jobs to downtown Baltimore with a check-remittance center slated to open by October.

The facility will be located on a parcel of land in the 1000 block of E. Fayette St. across from the main post office, which is in an empowerment zone. Under an agreement between Bank One and Baltimore and the state, the Maryland Economic Development Corp., a public, nonprofit economic development corporation, will serve as developer for the project. The city will donate the land, and MEDCO will build a 40,000-square-foot facility and an attached garage with 162 spaces. MEDCO will then lease the facility, estimated to cost $6.5 million, to Bank One for 10 years with two five-year renewal options. A contractor has not been chosen.

The bank expects to create 500 full-time jobs over five years. Employees will be hired locally and paid salaries of between $20,000 and $30,000.

"This is really a fabulous win for the city," Richard C. Mike Lewin, secretary of the Maryland Department of Business and Economic Development, said yesterday.

Bank One will receive a combination of incentives, training grants, and land-acquisition and site-development help. Funding may include loans and grants of up to $1.65 million from various public agencies, including $1.4 million from the Empower Baltimore Management Corp., a land write-down and grant from Baltimore Development Corp. and $60,000 from the Baltimore Office of Employment Development, according to a document obtained by The Sun.

"Creation of development-ready land in the city, as with the East Fayette Street Corridor Business Center, has proven essential in our mission to retain and attract business," said M. J. "Jay" Brodie, BDC president. "This new business center enabled us to attract Bank One to Baltimore." The facility, which will accept and process more than 30 million items per month, will complement similar Bank One operations in Phoenix, Ariz., and Louisville, Ky.

"Bank One continues to see rapid growth in its retail lock box business as large national companies increasingly look to us to provide high-quality processing of their customers' payments," said Ray Valour, senior vice president of Bank One. "The new Baltimore facility will help us serve customers even more efficiently on the East Coast."

The Greater Baltimore Alliance started talking with Bank One in August 1998, according to Ioanna Morfessis, the GBA's president and chief executive officer.

"This is a real coup for Baltimore," Morfessis said. "This will signal to other similar financial institutions that Baltimore is a really good place for back-office and operational facilities. More will come. I've seen it happen in other markets."

In this case, the economic development system worked as it should, she said.

"Our job is to go out in the national marketplace and capitalize on strong relationships," Morfessis said. "It's the job of the local government and the state to reel them in."

Bank One has come under fire lately for its troubled credit-card unit.

Former Bank One Corp. Chairman and Chief Executive Officer John B. McCoy, who built the bank through acquisitions, resigned in December after his purchase of a credit-card company backfired, hurting profit and cutting the bank's stock by almost half in four months.

Bank One stock then rose as much as 13 percent after the bank said it was seeking a replacement for McCoy, ending the dynasty that ran the institution for three generations.

McCoy's resignation occurred after Bank One warned twice in less than three months last year that trouble in its First USA Inc. credit-card unit would hurt earnings. Wilmington, Del.-based First USA was losing customers to competition, forcing it to cut prices and spend more on marketing and hiring, according to Bank One.

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