Baltimore's titans of banking have fallen to out-of-state competitors
By From Baltimore Sun Staff Reports
Apr 13, 2014 at 8:16 AM
In recent years, Maryland has seen many local banks acquired by out-of-state rivals. A little over a decade ago, the state had 139 banks based here, with 20 of them separately chartered affiliates of Mercantile-Safe Deposit & Trust Co., according to the Maryland Bankers Association. Here are a few of Baltimore's most prominent banks that have been bought up over past three decades.
Provident Bank (1886-2008)
Provident, which had been based in Baltimore since the late 1800s, had long prided itself on its independence. But the bank struggled during the recession that began in 2008 and decided to sell itself to Buffalo, N.Y.-based M&T Bank despite getting a $151.5 million infusion from the federal Troubled Asset Relief Program. Before merging with M&T, the bank had 142 branches in Maryland, Virginia and southern Pennsylvania. For 25 years, Provident was headquartered in a 1920s-era building on Lexington Street.
Mercantile Bankshares Corp. (1864-2007)
Created as a repository of Southern wealth in 1864, it was a place where executives served their elite clientele quietly and ran their business conservatively. It was a place where vault security rivaled Fort Knox and federal insurance for deposits was considered a sign of banking weakness. The 143 year-old-bank ceased to exist in 2007 when Pittsburgh-based PNC Financial Services Group purchased the bank for $6 billion in cash and stock. The bank was known for philanthropic contributions. In 2005, Mercantile made $5 million in grants and donations to nearly 1,500 community organizations, according to the bank. Major gifts included $1 million to Catholic Charities for a new Our Daily Bread Employment Center and an expanded My Sister's Place, a day program for homeless women and children.
First National Bank of Maryland/Allfirst (1864-2002)
First National Bank of Maryland was established in 1864 and distinguished itself by continuously paying dividends to shareholders, even during the Great Depression. In 1989, Allied Irish Banks, PLC of Dublin, Ireland, purchased First Maryland Bancorp. The transaction marked the first acquisition of a major Maryland bank by a large foreign banking institution. In 1999, after more than a year of planning and test marketing, the company's name changed to Allfirst Financial Inc. But the bank was brought down by millions in losses by rogue trader John M. Rusnak in 2002, leading to its eventual sale to Buffalo-based M&T Bank.
Maryland National Bank (1805-1993)
Maryland National Bank -- which long was based out of the towering skyscraper at 10 Light Street -- was bought by NationsBank in 1993 for $1.38 billion. NationsBank later became Bank of America. When it was sold, it was Baltimore's oldest and largest banking company. MNC Financial, the bank's parent company, was among the state's most powerful business and philanthropic institutions in its mid-1980s prime. MNC Financial had more than 7,500 employees before it was sold.