Building Chase

Banks may be struggling to make money in Florida, but JPMorgan Chase is racing to build more branches in the state.

From Pasco to Collier, Chase has spent $160 million this year to build new branches, and it now has a total of 64 in the eight-county region. Bank officials say they plan to exceed this year's construction budget in 2012, declining to be more specific.

“It's the fourth-largest state, it's a state where we had no presence and it's an important place to be,” says Mel Martinez, the former U.S. senator from Florida who is now chairman of JPMorgan Chase for Florida, Mexico, Central America and the Caribbean.

Martinez recently was in Fort Myers to celebrate the opening of six new branches in the region. “We have 288 branches [statewide] and we're looking at 350 in a year,” he says.

Statewide as of June 30, Chase had almost as many offices as BB&T (270 offices in Florida), but fewer than Wells Fargo (668), Bank of America (649), SunTrust Bank (547) and Regions Bank (397), according to the Federal Deposit Insurance Corp.

The real estate downturn has presented opportunities that might not have been available during the boom of the mid-2000s. “We can pick the best corners or locations,” says Jeremy Young, Chase's senior vice president and head of branches in West and Central Florida.

“Our mission is not accomplished from Pasco to Collier,” Young says. “We have a robust pipeline for 2012.”

Stricter regulatory rules under the Dodd-Frank bill won't stop Chase from moving ahead with its aggressive growth plans in Florida. “We're prepared to live with Dodd-Frank,” says Martinez. “We're on course for Florida for the next year and a half to two years.”

And despite difficult economic conditions, Young says the variety of banking services Chase offers — from car loans to credit cards — can offset the costly building expense that can amount to $7 million to $8 million per branch on average. “Some branches can be profitable in 12 to 18 months, some can take longer,” he says.

Martinez, who joined the bank in 2010 after a headhunter sought him out for the job, says branch banking will remain popular despite new technology such as mobile-phone banking. “People still want to go to the bank,” he says.

In the past year, the bank has grown mostly by adding branches. Still, Martinez says, “We're not averse to acquisitions.”

However it expands, Chase is betting that Florida will continue to attract people and grow. “Geography and weather haven't changed,” Martinez says. “We're seeing modest job growth already.”

What's more, Florida will benefit from growth in Latin American countries and the recently signed free-trade agreements will boost business in the state. “The Colombia free-trade agreement is a tremendous plus for Tampa,” Martinez says, for example.

But Martinez acknowledges that the housing crisis will linger. “It's unfortunately still a matter of years,” he says. “We have to get through the housing mess in order to get to the other side.”

Chase has opened 13 homeownership centers across the state to help the bank's struggling customers. The bank has done that by changing interest rates and other terms of its loans.