Southeastern Wisconsin financial service industry news
Tuesday, August 26, 2014
BMO Financial Group reports flat quarter
BMO Financial Group and Bank of Montreal, parent company of BMO Harris Bank, today reported third quarter net income of $1 billion, flat from the third quarter of 2013.
Revenue was $3.8 billion, up slightly from $3.7 billion in the same period a year ago.
Provisions for credit losses were $130 million, compared to $76 million in the third quarter of 2013. The third quarter of 2013 was especially strong because of very low credit losses and a positive impact of long-term rates on insurance, the company said.
Higher revenues across all businesses were driven by strong growth in client assets and increased transaction volumes.
U.S. Personal and Commercial Banking reported net income of $147 million, up 2 percent over the same period a year ago. Average current loans and acceptances increased year-over-year because of strong growth in the core commercial and industrial portfolio.
"BMO delivered very good results in the third quarter confirming continued momentum across our businesses," said Bill Downe, chief executive officer, BMO Financial Group. "Adjusted net income was up 4 percent from particularly strong results a year ago and adjusted earnings per share have increased 8 percent year-to-date. Net income and pre-provision, pre-tax earnings growth in U.S. Personal and Commercial Banking was encouraging, with improved revenue trends despite the low interest rate environment.”
Associated Bank to open Third Ward branch
Green Bay-based Associated Bank plans to open a new branch in the River Renaissance building at 102 N. Water St. in Milwaukee’s Historic Third Ward.
The bank leased the 1,640-square-foot space from Colliers International|Wisconsin. Construction will begin in October, and the branch is expected to open in March 2015.
The new branch will offer 24/7 self-service banking solutions and a digital demonstration zone, where customers can sign up for online banking and use Associated’s online and mobile applications.
On Monday, Associated Bank opened its new 3,011-square-foot Haymarket Square location at 1301 N. Martin Luther King Jr. Drive, just north of the Park East corridor in downtown Milwaukee. That branch offers seven-day banking and extended hours.
The Associated Bank branch on the first floor of the First Financial Centre office building at 700 N. Water St. in downtown Milwaukee closed Thursday. That 14-story office building will be sold this week in an online auction at auction.com.
Associated Bank also has a branch at 401 E. Kilbourn Ave. in downtown Milwaukee.
The new branch will be one of just two bank branches in the Third Ward neighborhood. The other is a branch of Greenfield-based Pyramax Bank at 318 N. Water St.
“We’re really pleased to continue our development into Milwaukee’s vibrant Third Ward neighborhood,” said John Halechko, executive vice president, director of branch banking, Associated Bank. “Downtown Milwaukee represents an important market for Associated Bank, and we are committed to serving both our customers and the downtown community.”
JPMorgan Chase flags $225,000 for Water Council
The Water Council will receive $225,000 from a $30 million grant program facilitated by JPMorgan Chase & Co. through its Small Business Forward initiative.
The grant total was announced Monday at a press conference held at the Global Water Center in Milwaukee, with remarks from Gov. Scott Walker and Mayor Tom Barrett as well as James Popp, president of Chase in Wisconsin, and Rich Meeusen, co-founder and co-chair of The Water Council and chairman, president and CEO of Milwaukee-based Badger Meter.
JPMorgan Chase’s new Small Business Forward initiative is a national, five-year grant program supporting small business networks in 10 cities across the country.
“The Small Business Forward Initiative is focused on clusters…that leverage the best things in different communities and the best opportunities to make a difference and make an impact while also facilitating small business and entrepreneurship in communities,” Popp said. “The Water Council was one of those clusters.”
The Water Council plans to use the one-year $225,000 grant to help identify investment firms interested specifically in water technology and then bring them to Milwaukee to educate them about Milwaukee’s water hub as well as connect them with companies in need of funds.
“So it’s identify, educate and connect,” Meeusen said. “Those are the three important pieces.”
The Water Council has found that it needs to connect investors with “the companies that need money,” Meeusen said.
“And there is a problem in Wisconsin with making that connection,” he said. “We’re having trouble doing that.”
With the grant from JPMorgan Chase, the Water Council plans to hire a full-time staff member to travel and meet with potential investors to explain the benefits of coming to see Milwaukee’s water technology, according to Meeusen. The Water Council will also host seminars and conferences to bring investors and entrepreneurs to the same table.
During Walker’s remarks at Monday’s announcement, he called attention to The Water Council’s impact across Wisconsin.
“We’re pleased with The Water Council to have statewide…nearly 300 businesses related to water and water technology and clean water technology and beyond and generate about 37,000 jobs across the state and generate about $5.7 million in terms of annual sales,” Walker said. “And so you can see this cluster has a dynamic impact.”
JPMorgan Chase announced its $30 million Small Business Forward initiative in July, but Milwaukee’s grant total was the first of any beneficiary to be announced.
“We think that’s symbolic of the focus on this cluster here,” Walker said.
The firm plans to expand its Small Business Forward initiative to a global scale in 2015.
ZBB to raise $14 million through public offering
Menomonee Falls-based ZBB Energy Corp. is raising $14.8 million through a public offering of 11.5 million shares of its common stock.
The company, which develops renewable energy power platforms and hybrid vehicle control systems, has priced the stock at $1.12. The underwriter, Craig-Hallum Capital Group LLC, has exercised its full overallotment option to purchase another 1.7 million shares.
The offering is expected to close on Aug. 27. The net proceeds for ZBB would be about $13.5 million, and the company plans to use the funds for general corporate and working capital.
Alderman wants to increase city's bonding authority by $100 million for arena
Milwaukee Ald. Joe Davis Sr. has announced a proposal to increase the city's bonding authority by $100 million during the upcoming 2015 budget process to give the city funding option flexibility for a proposed new arena.
“It is my intent to increase the city’s bonding authority by $100 millon, so that the city has all options on the table to play its part as a partner in this critical project,” Davis said. “Let me be clear, this initiative would not designate a single dime to be used for a new arena. It would simply give the city the flexibility to pursue that option later in the 2015 budget if leaders see fit.”
The NBA says the BMO Harris Bradley Center in downtown Milwaukee is no longer adequate and that a new arena is needed for the Milwaukee Bucks in order for the team to remain in the city long-term.
The cost for a new arena is estimated between $400 million and $500 million. New Bucks owners Wes Edens and Marc Lasry have pledged $100 million to the project and former owner Herb Kohl has also pledged $100 million to the project.
“Depending on how you price out the new arena, 40 to 50 percent of the costs are already accounted for,” Davis said. “Presuming it will cost in the area of $500 million, the new owners and the old owner have already brought $200 million to the table. The new owners will sell 20 percent of the team to local investors, so that should net an additional $100 million. Naming rights can go for $4-5 million a year in the NBA, so for 20 years that’s somewhere in the area of $80-100 million. What we are really talking about is a $100 million to $150 million problem.”
The city has options including the issuance of revenue bonds, general obligation bonds and tax exempt bonds, Davis said.
“I will be proposing the City of Milwaukee become an equity partner as an investor in the new facility, with the intent of gaining a return on investment as revenue for the usage of the facility increases,” Davis said. “As an investor, the city will exercise a leadership role in the operations of the facility with the authority to appoint a private sector partner to represent the city’s long-term initiative to liquidate its equity at the appropriate time.”
Davis threw cold water on one funding option, a so-called “Super TIF” that would divert all taxes from a district toward the project.
“While (a Super TIF) has worked in other communities and I think it’s a marvelous idea to fill the gap, it simply will not happen,” Davis said. “Suburban community leaders have expressed their objections loud and clear, and I respect their decision.”
The location of a new arena has not been determined, but Mayor Tom Barrett has said he wants it to be located downtown, west of the Milwaukee River and as close to Wisconsin Avenue as possible.
Some observers expect most public officials to wait until after the November elections to tackle the arena issue.
“While there may be hesitance to use public money for sports facilities because of a lack of political will and commitment, in Milwaukee’s case, the arena writes our future,” Davis said. “Let’s not wait for reelection time—let’s look our situation straight in the eye, create alternatives beyond the imposition of some new tax and get the job done.”
Alpine Valley Music Theatre is for sale
Alpine Valley Music Theatre, a 37,000-seat outdoor concert venue in East Troy, is for sale.The property was put up for sale within the last month, according to John Kersey, executive vice president of Milwaukee-based Zilber Ltd., which owns the venue.
News that the venue was for sale was first reported by Urban Milwaukee Dial, which says the asking price is $8.4 million.
Kersey declined to disclose the asking price for the property.
Zilber has owned Alpine Valley for more than 20 years.
“The asset has performed very, very well for us,” Kersey said. However, “moving forward we want to focus on our core competencies of industrial and office development and home-building.”
Alpine Valley is operated by Beverly Hills, Calif.-based Live Nation, which has a long-term lease with Zilber, Kersey said. He declined to provide further details.
BizTimes Media seeking Nonprofit Excellence Awards nominations
What does philanthropy look like at your company? How has your workplace made a difference in southeastern Wisconsin?
BizTimes Media will honor top corporate citizens of the region through the inaugural BizTimes Media Nonprofit Excellence Awards. The awards program is designed to salute the work of for-profit organizations, executives and professionals who donate their time, talent and treasure to community causes.
Award winners will be celebrated during a Nov. 4 breakfast and ceremony at Potawatomi Hotel & Casino Events Center in Milwaukee.
Awards will also be distributed to nonprofit organizations and leaders making the region a better place to live, work and place.
BizTimes invites southeastern Wisconsin’s business and nonprofit communities to nominate deserving individuals, companies and organizations for its Nonprofit Excellence Awards.
Self-nominations on both the corporate and nonprofit side will be accepted. Award nominations, submitted through a form, are due by Friday, Aug. 29. Corporate citizens and nonprofits may be nominated for multiple categories. Nominators must complete a new form for each category.
BizTimes encourages nominators of for-profit companies to submit their entries as soon as possible. The Nonprofit Excellence Awards’ corporate citizen awards feature five categories: Corporate Citizen of the Year, Next Generation Leadership, In-Kind Supporter, Corporate Volunteer of the Year, and Lifetime Achievement.
The program’s nonprofit awards feature four categories: Nonprofit (organization) of the year, Nonprofit Collaboration of the year award, Nonprofit Executive of the Year and Social Enterprise.
Nonprofit nominees must be tax exempt 501(c)(3) organizations based in Milwaukee, Waukesha, Ozaukee, Washington, Racine, Kenosha, Walworth or Sheboygan counties. Chapters or affiliate national organizations may be nominated if they are locally managed.
For detailed descriptions of each award, visit www.biztimes.com/npawards.
This exclusive news bulletin is compiled by BizTimes Milwaukee reporter Molly Dill. This bulletin is published every Tuesday morning. Send financial services industry news and tips to firstname.lastname@example.org or call her at (414) 336-7144.
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