Skip the barbecue. Bring back the bagels.
In a sea change for a Florida market long dominated by Carolina banks, New York's giant money-center banks — largely has-beens in consumer banking here for many years — are suddenly back with a vengeance.
And with a whole lot of Florida market share. In a New York minute, Big Apple banks control close to a quarter of Florida's banking deposits and soon will be vying for additional business.
The big breakthrough came in Monday's deal by New York's Citigroup to buy the banking assets of North Carolina's Wachovia Corp., including all of the Wachovia branches and deposits in Florida. That deal alone makes Citigroup the No. 1 banking player in Florida with a hold on more than $1 of every $5 of banking deposits in the state.
Does that make Florida's No. 2, North Carolina's Bank of America, happy? Fuhgeddaboutit. New York's Citigroup has long been a BofA rival in the "who's the bigger bank" contest. Now it's invading one of BofA's best states.
Citigroup's purchase of Wachovia — a bank headquartered on the same street as BofA in the heart of Charlotte, N.C. — also painfully diminishes a North Carolina city long obsessed with its own banking size.
"It's very, very much a body blow to the city," retired Bank of America chief Hugh McColl Jr. told the Charlotte Observer.
Citigroup's nabbing of Wachovia follows last week's purchase by New York's JPMorgan Chase of struggling Seattle-based Washington Mutual, the No. 5 banking institution operating in Florida.
In both cases, the New York banks were assisted by three seemingly unrelated matters: the lack of public confidence in the economy; the toxic mortgages held by two West Coast savings institutions — California's Golden West (parent of World Savings Bank) and Washington Mutual; and the aid of the Federal Deposit Insurance Corp.
Wachovia fell into trouble because it overpaid for Golden West at the peak of the housing market. Golden West pioneered the "Pick-A-Pay" mortgage, an adjustable-rate home loan that let borrowers defer monthly interest payments by increasing their mortgage balance. When home prices started to fall, that mortgage proved toxic, dragging down Wachovia and making it an easy target for Citigroup.
In both the Wachovia and Washington Mutual deals, the FDIC offered buyers Citigroup and JPMorgan Chase guarantees or accepted responsibilities for portions of the weak institutions before they were sold.
Once all these deals are done, what's the new pecking order of banks in Florida?
1. Citigroup, New York
2. Bank of America, Charlotte, N.C.
3. SunTrust, Atlanta
4. Regions Bank, Birmingham, Ala.
5. Colonial Bank, Montgomery, Ala.
And just how long is this ranking likely to last?
Citigroup has deep pockets and international breadth, but it has struggled lately to raise capital, produce solid earnings and redefine its mission. Bank of America is buying Merrill Lynch — great if they pull it off well, but a major distraction for now. SunTrust is a perennial target of takeover rumors, especially if its stock price sags. Ditto Regions, whose shares on Monday fell 41 percent. And Colonial has a big exposure to Florida's weak housing market.
Robert Trigaux can be reached at firstname.lastname@example.org.