MBNA deal sends chills through town

Takeover: Bank of America's purchase of MBNA is viewed anxiously by a Maine town it helped to thrive.

August 27, 2005|By THE BOSTON GLOBE

BELFAST, Maine - Nearly a decade ago, with little advance notice, credit-card company MBNA Corp. dropped thousands of jobs into this one-stoplight city then poured millions of dollars into local schools and nonprofits - all because, according to local legend, a friendly resident lent money to the man who one day would be MBNA's chief executive when his car broke down.

Almost overnight, as MBNA's work force exploded, Belfast was transformed. The city, once home to chicken factories that poured grease and guts into the Passagassawakeag River, began to teem with executives in business suits, talking on cell phones and riding around in black SUVs.

Now that the region's corporate benefactor is about to be swallowed by Bank of America Corp., state and local officials are mounting an aggressive campaign to save those jobs. But at the same time, they are growing increasingly worried about what will happen if they fail.

Gov. John Baldacci met with Bank of America executives in the state capital of Augusta on Tuesday to stress the benefits of keeping MBNA's operations in Maine and to offer a variety of tax incentives to induce them to stay. Both sides said the meeting went well, but that the bank has not made any decisions.

"We've established good lines of communication as their review process moves forward," Baldacci said. Bank of America's director of public policy, James Mahoney, described the meeting as "very candid and very direct" and said it was clear the governor had made the jobs a high priority.

Bank of America has said it would cut 6,000 jobs during the merger of the two companies' combined work force of about 200,000. The decision about Maine may not come for months - the merger is not expected to close until later this year or early 2006.

MBNA now has 3,000 call-center and back-office jobs in Maine, including about 1,900 in Belfast, and the rest scattered in Fort Kent, Presque Isle, Farmington, Portland, Orono, and Brunswick.

In Belfast, population 6,381, local officials launched a letter-writing campaign to Bank of America's chief executive, Kenneth D. Lewis, at its headquarters in Charlotte, N.C. In one letter, the Parent Group at Drinkwater Elementary School in nearby Northport told Lewis it formally welcomes his `'great banking institution into our backyard."

`Warm invitation'

"Mr. Lewis, we want to extend a warm invitation to you to visit Belfast and speak with the local people who live and work here," the group's chairwoman, Carolyn Carson-Crosby, wrote. `'We would welcome the opportunity to give you a personal tour of our school and community. The people of this small coastal Maine city have so much to offer Bank of America."

The Belfast Rotary Club praised Bank of America's commitment to its advertising tagline, `'Higher Standards," and said Rotarians are held to their own high ethical standards, while the Scoutmaster for Boy Scout Troop 27 asked Bank of America to continue MBNA's partnership in "helping the youth of America."

Local residents also are making plans for `'MBNA Appreciation Day," an Oct. 1 party in which they will place an honorary plaque on a local boathouse that MBNA donated to the city.

When the news of Bank of America's $35 billion acquisition of MBNA broke eight weeks ago, it dominated conversations in restaurants, dentists' offices, and the commercial strip of this tiny city.

Nearly everyone, it seems, knows someone at MBNA who has just bought a home or started a family, and whose job is now in question.

MBNA came to Maine in the early 1990s, setting up shop with a few dozen employees in the town of Camden, summer home of its then-chief executive, Charles M. Cawley. From there, under Cawley's leadership, MBNA expanded rapidly to the nearby Belfast and Rockland as its business grew.

Many in Belfast still remember MBNA's big open house when it first moved down the road. The company gave tours of its campus, so out of place in rural Maine, to visitors from across Waldo County.

"One can't help but be impressed with the size and architectural grandeur of the facility," the local newspaper raved, while likening MBNA's computer command center to "a smaller version of NASA's Mission Control Center."

The uncertainty at MBNA had come on top of the Pentagon's recommendation to close the Portsmouth Naval Shipyard and other operations in the state, which would cut about 7,000 jobs. The state breathed a sigh of a relief this week when the Defense Base Closure and Realignment Commission rejected the Pentagon's recommendation on Portsmouth.

Even so, the state in May posted New England's second-highest unemployment rate, at 5 percent.

With the rise of MBNA in Maine, Cawley, its former chief executive, has become an almost mythical figure here. Cawley, in an interview, said the story about his car troubles are somewhat true: As a young man his car broke down in Camden one summer, and a mechanic fixed it even though Cawley could not pay him right away.

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