M&I Bank to add branches in east metro

Marshall & Ilsley Bank is making a big push into the Twin Cities' east metro area.

Brad Chapin, president of M&I Minnesota, hopes to have up to a dozen bank branches in the east metro within three years, compared with four today.

"This is a growing market and we want to be growing with it," he said. "We don't have much of a base on the east side (of the metro area). We need to be in that area too."

The Twin Cities banking market is extremely competitive. Wells Fargo and U.S. Bank dominate — with combined deposits of $32.12 billion, or 57 percent of the market.

Milwaukee-based M&I, the largest bank in Wisconsin, will be content to increase its market reach, if not its 2.4 percent market share in the Twin Cities, Chapin said. Its Twin Cities deposits of $1.36 billion as of June 30 rank it the No. 5 bank in the metro area.

M&I plans to open a new branch in Lakeville in April and later this year in Blaine and Oakdale. It also is looking for locations in Apple Valley, Eagan, Roseville, St. Paul's Midway area, West St. Paul, White Bear Lake and Vadnais Heights to open within three years, he said.

Jon Arfstrom, a bank analyst for RBC Dain Rauscher in Minneapolis, said M&I's expansion plans make sense.

"They're good commercial lenders and they'll be good middle-market competition," Arfstrom said. He also expects money management and financial planning services to be a big part of M&I's strategy.

M&I has had a lending presence in the Twin Cities since the mid-1990s. It entered the local retail banking market in 2001, with the purchase of Minneapolis-based National City Bank. Two more acquisitions followed in 2002 — Richfield Bank & Trust Co. and Century Bank of Eden Prairie.

The bank now has 19 branches in the Twin Cities, including four in the east metro: one in St. Paul, one in Woodbury and two in Burnsville. M&I also has branches in Duluth and in Hudson, Wis. The bank has 400 employees in the Twin Cities and plans to add 40 people this year.

M&I's deposits in the Twin Cities have increased in the past two years after a decline in 2003. Chapin attributes the deposit growth to increased marketing of interest-bearing accounts and an effort to attract wealthier customers.

M&I's strategy for the Twin Cities reflects a more aggressive growth approach companywide. Last year, total revenue jumped 21 percent to $1.75 billion and profit rose 16 percent to $727.5 million from 2004.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.