Florida Home Mortgage Provider Sees Gains Despite Housing Market Woes

A troubled Florida housing market may slow down the state’s economy, but it won’t deter the Sunshine State’s biggest bank from expanding its market share, says the St. Petersburg Times.

“We want to widen our lead,” said Ken Thompson, chairman, president and CEO of Wachovia Corp.

The exec was in the Tampa Bay area Tuesday and Wednesday to meet with local business leaders. Those hoping for a rebound in local real estate didn’t hear much encouragement from Thompson or the bank’s economist Mark Vitner.

“We don’t think we’ve seen the bottom yet. But we do see the correction happening faster than in the past,” Thompson said.

While plenty of local banks are beginning to report problems with Florida mortgage loans, he said that shouldn’t be an issue for Wachovia.

“I don’t think there will be a credit problem. But it will be a volume problem with fewer new loans being written,” he said.

Wachovia just spent $24-billion to buy Golden West Financial Corp., giving it a much bigger presence in Florida mortgage lending. Thompson scoffed at the suggestion that the purchase might be bad timing, given current market dynamics.

“The timing was just right. We just passed 300 million people in the U.S. last year, and in the next 30 years, the country will have amassed 400 million people. That by itself tells me that the mortgage business is going to be a great business.”

Wachovia’s acquisition of Golden West, which included subsidiary World Savings Bank, pushed Wachovia past Bank of America as Florida’s largest bank with a 19.9 percent market share.

Thompson said World Savings will disappear next year as it is consolidated with Wachovia. That might be bad news for baby boomers and Tampa Bay area retirees, who have grown to love World Savings’ high CD rates. But Thompson promised that his company going to be assertive on CD pricing.

Wachovia will consider additional, smaller acquisitions that look like a good fit, but the company isn’t looking to acquire any major Florida home loan providers at this time, Thompson said.

He said Wachovia will continue to expand its investment banking services and its brokerage, which now makes it the third-largest U.S. broker. The bank ranks fourth-largest nationally.

Banking’s future will bring more consolidation, pressure for efficiency, globalization and competition with nonfinancial companies, Thompson said. Wachovia may eventually take its bank overseas, providing services such as asset management and brokerage.