Scott Martin published a new article Wilmington's Wealthy Clients Rattled as Loan Loss Scandal Unfolds on The Trust Advisor Blog, December 4, 2010.
While shareholders complain that merging with M&T destroys the legendary trust bank's reputation, the jury's still out on whether the deal will dilute its brand. Either way, new filings reveal that regulators already unnerved clientele. When Wilmington Trust sold itself to Buffalo-based M&T Bank a month ago, industry observers were shocked to see the high-end business go to a retail-oriented competitor -- and investors balked at the steeply discounted price. But SEC filings confirm that Wilmington management really didn't have a choice if they wanted to keep scandal-wary clients on board. As it turns out, after regulators discovered that the bank had failed to mark down its deteriorating loan portfolio, they basically gave management an ultimatum.
While shareholders complain that merging with M&T destroys the legendary trust bank's reputation, the jury's still out on whether the deal will dilute its brand. Either way, new filings reveal that regulators already unnerved clientele. When Wilmington Trust sold itself to Buffalo-based M&T Bank a month ago, industry observers were shocked to see the high-end business go to a retail-oriented competitor -- and investors balked at the steeply discounted price. But SEC filings confirm that Wilmington management really didn't have a choice if they wanted to keep scandal-wary clients on board. As it turns out, after regulators discovered that the bank had failed to mark down its deteriorating loan portfolio, they basically gave management an ultimatum.
Click here to read the entire article.
Posted by Yi Song, Associate Editor, Wealth Strategies Journal.
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