Building upon an acquisition that brought Commerce Capital Markets LLC into its group earlier this year, TD Securities USA LLC plans to expand its public finance business in areas along its already established banking presence on the East Coast.
The firm wants to hire three to four experienced bankers for its public finance group, said Gregory LiCalzi, senior vice president and managing director of public/not-for-profit sector finance for Commerce Capital. TD Bank Financial Group finalized its acquisition of Commerce Capital's parent - Commerce Bancorp Inc. - earlier this year. The public finance group, which for now is still operating under its own name, will work under the TD Securities name.
"The intent is to grow prudently and within the footprint of our affiliate TD Bank," LiCalzi said.
He said the public finance group will focus on serving clients primarily in TD Bank's stronghold Northeastern and Mid-Atlantic markets. It will also look to do some business in Florida, where it has some retail branches.
TD Bank provides a strong, stable capital base through which the public finance department can serve its clients, according to LiCalzi. In addition, it gives the public finance group access to TD's distribution capabilities, including TD Ameritrade, one of the world's largest online brokers.
The backing of TD Bank provides a boost to the public finance group, which lost much of its staff in 2004 when Commerce essentially exited the negotiated market amid pay-to-play allegations against some of its bankers. LiCalzi and a small group of bankers remained, working mostly on revenue deals for 501(c)(3) corporations.
The group has acted as the senior manager of eight negotiated deals in the Northeast region with a par value of $355 million so far this year, according to Thomson Reuters data. It served as the senior manager on just two negotiated deals with a par value of $12.4 million in the region last year.
The turmoil in the financial markets that has shocked Wall Street investment banks should produce opportunities for a regional bank willing to devote resources to the public and nonprofit sectors, LiCalzi said.
"We've really been under the radar screen, and we don't get the opportunities to play on the same kind of field some of our competitors were, but I think that's all changed now or will be changing," he said. "It just will take some time to staff up, get out there, and do the right things."
TD also picks up Commerce's already strong business in the competitive markets. Commerce ranked third nationally as a senior manager on competitive short-term note offerings, working on 289 deals with a par value of $2.6 billion so far this year. Commerce also ranked 11th in the Northeast region as a senior manager in competitive bond deals working on 44 deals with a par value of $391.5 million.