TCF Financial Corp., a Twin Cities bank with offices in almost every Chicago-area Jewel-Osco store, has ambitious plans to move beyond its supermarket base and operate more branches here than the local banking leader, Chicago-based Bank One Corp.
“We really believe it’s going to be our best market,” said Jason Korstange, TCF’s head of corporate communications.
The Minnesota bank already has more than 170 offices here, with more than 140 of them in Jewel-Osco stores. Bank One has about 180 branches in the Chicago area, about a third of them in Dominick’s stores.
Although very few banks nationally have made a success out of supermarket branching, it is TCF’s bread and butter.
TCF, which serves Minnesota, Illinois, Wisconsin and Michigan, has roughly 62 percent of its branches in supermarkets. They represent about 68 percent of TCF’s fee and other non-interest income, and the cost to run them is lower than traditional branches.
TCF overall has a respectable 1.8 percent return on average assets and 23.4 percent return on average common equity.
Despite its supermarket focus, the firm is looking to bolster its visibility and profits by opening traditional branches.
“Part of it is psychology,” said David Creel, TCF’s head of marketing in the Chicago area. “The traditional branch becomes more of a foundation. … Also, people see TCF in the store a lot, so they’re familiar with it when they see the traditional branch.”
With its supermarket strategy, TCF has succeeded where many other banks have not. Bank of America, for example, tossed its Chicago-area Jewel-Osco branch leases in the late ’90s. TCF picked them up and now has more branches in the Chicago area than in its home state of Minnesota.
TCF also defies banking convention by eschewing acquisitions. It has bought banks over the years, but mostly it grows organically, one branch at a time.
That’s how officials say it will expand in Chicago.
“It’s too expensive to acquire,” Creel said.
More Top Picks Best Kids Picnic Tables For Outdoors
Bonus plan progresses: Branch managers and other high-ranking employees at Bank One’s branches learned last week about a new incentive plan that will base their bonuses on individual branch profits, beginning with the last six months of this year. The program is a work in progress, said Chief Executive Jamie Dimon. “It’s not perfect. It’s just better,” he said.
– Pamela Voss has been appointed president of Chicago-based First Bank of the Americas, which has branches in the Little Village, Pilsen and Back of the Yards neighborhoods. Most recently, Voss was a director of FBA Bancorp Inc. in Chicago.
– Bank of America Corp. has named longtime employee John Brennan to lead its private bank in Chicago, which caters to wealthy clients and families. Most recently, Brennan was regional marketing executive for California.