Wachovia, SouthTrust Growth Plans In Limbo
By Kevin Wiatrowski
June 23, 2004
Wachovia Corp.'s announcement this week that it will buy SouthTrust Corp. has cast a shadow over both banks' expansion plans in Pasco County.
Charlotte, N.C.-based Wachovia and Birmingham, Ala.-based SouthTrust both are adding to their local presence, particularly in fast-growing Trinity, Land O' Lakes and Wesley Chapel. In all three places, both banks plan branches within a mile or so of each other.
The merger is likely to lead to fewer bank branches as the combined company cuts out duplication, said Ken Thomas, a Miami-based consultant who advises banks on locating branches.
"All past talks about expansion now become talks about contraction,'' Thomas said.
Thomas estimated the new bank could cut by half the 20 to 26 branches it would have as the expansion plays out.
"Projects are likely to continue only if there's not overlap,'' Thomas said of both banks' plans for new branches in Pasco.
In the long run, closing branches or dropping plans for new ones probably means less competition for Pasco's mortgages and other investment, Thomas said.
However, the prospect of an empty bank could also invite smaller players into the county, expanding competition, he said.
"A closed branch is like a closed bowling alley: There's not too many uses for them,'' Thomas said.
Wachovia and SouthTrust are likely to decide in the coming months which overlapping branches will survive, said Dan Richardson, Tampa-based senior vice president for SouthTrust.
SouthTrust broke ground Monday on its Trinity branch. Wachovia has its eye on the same area but hasn't begun construction yet. At this point, there are no plans to pull back on expansion, said Tina Orluski, SouthTrust's local marketing administrator.
"We're going to continue to conduct business as usual,'' Orluski said Tuesday.
Wachovia has 11 branches in Pasco and plans four more. It's building a branch at Collier Commons in Land O' Lakes just down the road from a SouthTrust branch.
SouthTrust has nine branches and will add two, including one near a planned Wachovia in Wesley Chapel's Wiregrass Ranch development.
On Monday, Wachovia officials said they will close 130 to 150 branches, mostly in Florida and Georgia. The merger could take 15 months to complete, company officials said.
How those closings will affect Wachovia's plans for Pasco remains to be seen, said Kevin Bezner, spokesman for its Florida operations.
"The merger integration team will be looking at our branches and trying to determine what's best for our company,'' Bezner said.
Reporter Kevin Wiatrowski can be reached at (813) 948-4201.
This story can be found at: http://tampatrib.com/pasconews/MGBQYBPUSVD.html