As quickly as it came, Charlotte’s claim to being the real headquarters of the nation’s 14th-largest bank holding company vanished. When GMAC Inc. named Al de Molina CEO in April 2008, headquarters remained in Detroit, but he stayed in the Queen City, his home for nearly 20 years. Other top executives worked there, too, including the chief risk officer, chief marketing officer and head of human resources (Regional Report, October 2009).
But the board forced de Molina to resign in November and made board member Michael Carpenter chief executive. Carpenter, who started New York-based Southgate Alternative Investments in 2007 after 12 years in top management at Citigroup Inc., had joined the board in May. The company, officials say, will benefit from his experience in banking, capital markets and turnarounds. It has lost money three straight quarters.
Aside from the CEO post moving to New York, it’s business as usual for GMAC in Charlotte, spokeswoman Gina Proia says. “There’s no change planned for our corporate center in Charlotte. There are talented people there. Michael has worked in organizations like this before, where there were several different locations in the broader footprint. As long as it works, he has no problem with it.”
Keeping high-level people in Charlotte makes sense, says Tony Plath, associate professor of finance at UNC Charlotte. Detroit isn’t a good place for a new bank holding company because it doesn’t have much banking talent. Charlotte even stacks up favorably against New York in some ways. “In their main line of business, which is decidedly consumer finance, this market makes the best sense in the country for them. You can find investment bankers and traders and M&A guys in New York. But you can find experienced consumer bankers in Charlotte in greater numbers.” Plus, “they’re a lot cheaper in Charlotte than they’d be in New York.”
Charlotte isn’t immune from cutbacks at GMAC. Though it had added 200 Queen City jobs in 2009, it cut about 45 mortgage jobs less than a month after de Molina resigned, leaving about 470 in Charlotte. Proia wouldn’t say if the decision was made before or after de Molina left. “This is not something that just suddenly happened. This is something that’s been looked at in the context of the broader mortgage operation.” It could have been worse. On the same day, GMAC announced it was closing its loan-processing center in West Hartford, Conn., idling about 85.
Mall deal falls apart
There was no doubt that Charlotte wanted to buy ailing Eastland Mall and redevelop it (cover story, October). The question was how much? The answer: not enough to pay the $22 million mall owners wanted. City Council had offered $7.4 million for most of the 83-acre site. In November, with the two sides so far apart on price, it directed city staff to drop efforts. That means Charlotte likely will forfeit $400,000 it spent on options to buy empty Belk and Dillard stores. Miami Beach, Fla.-based LNR Property Corp., which owns the stores between the anchors, declined comment on its plans. Columbus, Ohio-based Glimcher Realty Trust has turned over its piece of the mall to LNR, its lender.