TD Bank

TD Bank, N.A.

TD Bank, N.A. (formerly Commerce Bancorp) is a Cherry Hill, New Jersey, based bank holding company that offers banking, insurance, brokerage, and investment banking services in New Jersey, Pennsylvania, Delaware, New York, Connecticut, Virginia, Washington, D.C., Florida, and Maryland.

On October 2, 2007 it was announced that Commerce Bancorp would be acquired by Toronto-Dominion Bank, the owner and operator of competitor TD Banknorth. The acquisition closed on March 31st, 2008. The company will begin to re-brand Commerce Bank stores in late 2008 and TD Banknorth stores in 2009, all reflecting the new TD Bank name.

History

The company was founded in 1973 by fast-food restaurant franchise owner Vernon Hill, a graduate of the Wharton School of the University of Pennsylvania. Hill sought to bring fast food convenience to banking and expanded Commerce from one location to over 435 in thirty-three years. With growth of over sixty-five new stores opening annually, the company has planned to reach at least 800 stores by 2010. Television advertisements for Commerce Bank currently feature Kelly Ripa and Regis Philbin.

Business model

Commerce's philosophy is that they are retailers and not bankers, and go so far as to call their various locations stores, and not branches.

Features that Commerce offers its customers include:

7 day lobby or drive-thru hours, even in Center City Philadelphia and Manhattan.
Instant creation of ATM cards on the spot at the time of account opening
Free "Penny Arcade" coin counting machines for both customers and non-customers
No-Fee Visa Gift Cards for customers
Lollipops and dog biscuits in the lobby and drive-thru
Foreign ATM fee reimbursement (if you maintain a daily balance of $2,500 through the statement cycle)
"No Stupid Fees, No Stupid Hours"

Commerce Bank's business model has generated what some call a cult following in the geographic areas where they currently have stores. Commerce offers its customers merchandising giveaways such as coffee mugs, pens and pencils. In 2006 alone, they gave out 28 million free pens.

It has been called Mc-Bank because Vernon Hill used his knowledge of the fast food chains he owns and applied it to the banking industry.

This model was described in the case of study HBS 9-603-080 from Harvard Business School, published at 2002.

Availability of funds

Generally, deposits made at a Commerce store before 6 pm (8 pm in Florida store locations) will be available on the next business day.
Cash deposits are made available immediately.
The bank reserves their right (under Federal Regulation CC) to hold checks for longer periods of time under certain circumstances, including but not limited to:

New Accounts - During the new account's first 30 days, check deposits may by held up to seven business days. This applies to New Commerce Customers only.
Large Checks - Checks over $5,000 or a check deposit greater than the average daily deposit may be held up to seven business days.
Re-deposited Checks - Checks that have been previously returned may be held up to seven business days.
Repeated Overdrafts - Customers that have overdrawn their account an excessive amount of times (6 or more overdrafts in a 6 month span) may have a seven business day hold placed on all check deposits.
Reasonable Cause - If there is reason to believe a check is uncollectable (stale-dated, possible check-kiting, the check is in the process of being returned), the check may be held up to seven business days.

WOW! Awards

Every year since 1998, Commerce Bank has had an employee appreciation event called the WOW! Awards. 2006's WOW! Awards were at Radio City Music Hall for the third time (2006, 2005, 2003). Past venues have been: Boardwalk Hall in Atlantic City 2004, E-Center now the Susquehanna Bank Center in Camden, NJ in 2001 and 2002. In 2007, Commerce Bank will have regional WOW! Awards shows due to the larger footprint of the company.

Mascots

As with many companies, Commerce Bank has an official Mascot: Mr.C. Mr.C is the Commerce Bank logo, a red c, with black arms and black legs. He always has a huge smile and large bushy eyebrows.

Buzz Bee is also a mascot for the bank. However, Buzz is used primarily as an internal mascot for the "WOW! members" (i.e. the employees).

Both of these "mascots" are to be eliminated in the near future due to the TD acquisition.

Expansion

While most of Commerce Bank's growth is organic, there have been five large acquisitions since the bank's founding:

early 1990s - Four branch offices were purchased from Long Island-based Anchor Savings Bank: Cherry Hill Mall, Bellmawr, Woodcrest and West Deptford.
January 21 1997 - Independence Bancorp, Inc. became Commerce Bank/North.
August 13 1998 - Community First Banking Company and its subsidiary Tinton Falls State Bank became Commerce Bank/Shore.
September 17 1998 - Prestige Financial Corp. and it's subsidiary, Prestige State Bank became Commerce Bank/Central
July 25 2005 - Palm Beach County Bank established Commerce Bank in Southeast Florida.

TD Bank acquisition

On October 2 2007, TD Bank Financial Group (TDBFG) and Commerce Bancorp, Inc. announced that they had signed a definitive deal agreement for TDBFG to acquire Commerce Bank in a 75% stock and 25% cash transaction valued at US$8.5 billion.

Under the agreement, Commerce shareholders will receive 0.4142 shares of a TD common share and US$10.50 in cash in exchange for each common share of Commerce Bancorp Inc. The consideration was negotiated on the basis of US$42.00 per share value for Commerce Bank. The transaction value based on the October 1, 2007 closing price of TD common shares is $42.37.

Following the completion of the transaction, TDBFG expects to take a one time restructuring charge of approximately US$490 million pre-tax. The deal closed on March 31st, 2008, Commerce Bank employees were given a welcome kit with 2 TD pins (to replace the previous "C" pin worn by staff, a small bag of green M&Ms and a brochure of the history of TDBFG.

On March 20, 2008 the combined company announced they would be doing business as TD Commerce Bank after the merger, but as a result of a legal challenge in Massachusetts by Commerce Bank and Trust Company, a regional bank who competed directly with TD Banknorth in Massachusetts, over the use of the name, TDBFG decided not to go forward with its original rebranding plans. Instead the Commerce Bank name, red "C" logo, and red theme will be retired and the branches will carry the brand name TD Bank, although the "America's Most Convenient Bank" tagline will remain (as was originally planned).

The plans for rolling out the TD Bank brand are on track. In the Mid-Atlantic and Florida regions, TD Bank will begin rebranding the Commerce Stores with the TD Bank brand in November 2008. In the TD Banknorth bank region, the rebranding will launch in fall 2009.

Political connections

Commerce Bank is widely known to have hired a significant number of politicians in the state of New Jersey. In March 2003, South Jersey's powerful Democratic political leader George Norcross III was named to the board on the same day as former Republican Gov. Donald DiFrancesco. The board also includes Joseph Buckelew, former chairman of the Ocean County Republican Party.

Commerce Bank scandals

Two Commerce Bank executives, Glenn Holck and Stephen Umbrell, were found guilty in the Philadelphia City Hall Corruption Trial.

Mr. Holck and Mr. Umbrell approved loans to the city's then-treasurer, Corey Kemp, and others in order to get the inside track on city banking business.Commerce Bank was named or cited.

Commerce Bank also paid the NASD a $600,000 fine, and exited the municipal bond market. On December 8 2005, Commerce Capital Markets, Inc. consented to a proposed letter of Acceptance, Waiver, and Consent to settle alleged MSRB rule violations for conduct between 2000 and 2002. Without admitting or denying the alleged violations, and subject to final NASD approval, Commerce consented to the NASD’s findings; and a $600,000 fine.

CEO Vernon Hill resigned on June 29 2007; his resignation was effective as of July 31, 2007. This action is believed to be due to an overzealous bank examiner from the OCC who looked unfavorably on related party transactions, which consisted of real estate transactions, and bank design services. No wrong doing has ever been proven and the related party transactions had been disclosed since the banks inception.

Hill is leaving as the bank finalized arrangements to a new statute for corporate governance with the Office of the Controller of the Currency along with the Federal Reserve Bank of Philadelphia regarding insider transactions. Under the terms of the agreement, new leadership will work more closely with regulators in the future.

Robbery incidents

Since 2003, numerous Commerce Bank stores in the New York/New Jersey area have been robbed. Police officials such as New York City Police Department Commissioner Ray Kelly and other experts blame customer-friendly bank layouts, such as a lack of bulletproof teller windows, as well as bank practices, such as later closing hours, for making Commerce Bank stores more tempting targets.

Commerce Bank Harrisburg

Since 1985, Commerce Bank has had an independent franchise

in the Harrisburg, Pennsylvania region. Pennsylvania Commerce Bancorp, Inc.

has 33 stores in Berks, Cumberland, Dauphin, Lancaster, Lebanon and York counties

The headquarters for Commerce Bank Harrisburg is in Swatara Township, just outside Harrisburg. Commerce Bancorp shares a call-center with Pennsylvania Commerce Bancorp near Harrisburg, PA. Commerce Bancorp owns approximately 11% of the stock of Pennsylvania Commerce Bancorp.

Commerce Bank confusion

There are multiple banks running under the name Commerce Bank or some other similar name such as Commerce Bank and Trust Company. Since this can cause confusion, Commerce Bancorp should not be confused with Kansas City, Missouri based Commerce Bancshares, a $15 billion commercial bank. It also should not be confused with Commerce National Bank, a $3 billion business bank headquartered in Columbus, Ohio. Commerce National Bank is the 3rd largest bank bearing the name Commerce behind Commerce Bancorp and Commerce Bankshares.