J. William Middendorf II feels he's in the right place at the right time, reminiscent, he says, of the way he felt in the early 60s.
Back then he headed an investment consulting firm which specialized in banking, insurance and computer companies. They were to become the glamour stocks of the decade.
Today he is president and chief executive of Financial General Bank Shares Inc., the second largest bank pooling $15.1 million to buy Financial hind Riggs. Friends like Arkansas financial king Jacobson Stephens, Swiss banker Jorge Periera and international merchant Armand Hammer, along with about a dozen other investors, put him there last spring by pooling $15.1 million to buy Finacnila General.
The holding company used to belong to international Bank, a diversified financial service organization based in Washington, which was forced in April by the Federal Reserve to unload its interest.
An interview with Middendorf is like attending a one-man pep rally for Washington. He believes, with an earnestness that's infectious, he the metropolitan area is in for a commercial boom and that his bank is bound to rise with the tide.
It isn't as if the past 10 years have been uneventful for Middendorf. From Wall Street he went on to become ambassador to The Netherlands and Secretary of the Navy. But he says he hasn't been this excited in years.
The 52-year-old native of Baltimore, who composes symphonies and paints chins and seems never to sleep, consented last week to talk about his new life as a commercial banker and about the plans for Financial General.
Seated behind a huge butcher block-style desk, he began the interview by reaching for a list and reading: "Mobil Oil Corp., AT&T Long Lines, United Nuclear Corp., Continental Telephone, Martin Marietta, White & Case, Sullivan & Cromwell, . . ."
He continued, reeling off the names of companies, law firms, investment counselors and trade associations which have recently moved to or opened new offices in the area. He said it is only the beginning.
"The growth will become explosive," he predicted. "And we're in the best position to take advantage of it. We're the only one that operates in all three states."
Middendorf's company has assets worth more than $2 billions and owns 12 banks in the Washington area. In the District, it controls Union First National. In Maryland, it oversees American National, Chesapeake National and Eastern Shore National. In Virginia, it owns Arlington Trust, Clarendon Bank & Trust, Alexandria National and a handful of others. These comprise 85 per cent of Financial General's holdings. The rest includes a bank in New York City, one in Albany and another in Knoxville, plus the National Mortgage Corp.
Selling businesses on coming to Washington is going to be a major part of the new, more aggressive role Middendorf envisages for the company. Of his own job he said, "I'm just a traveling salesman."
"I was up in New York yesterday talking to Mobil," he recounted. "Everybody in towh has been up to talk to him, I'm sure, about servicing their new headquarters in Fairfax. But I think we've got a strong case."
Mobil remains undecided about whether to move only 800 people or its whole corporate staff of 3,500 to Virginia. One thing Middendorf intends to do, he said, will be to send a team to New York to explain the local tax structure to Mobil executives and promote the area's cultural and education advantages.
Financial General may be well positioned for the influx of commercial activity Middendorf foresees, but it's got an image problem. The parent company is barely recognized by the banking public and hardly better known in the business community. The reason is the business community. The reason is that traditionally the company kept a low profile.
"This firm was really just an investor in bank stocks up until about 3 or 4 years ago," said George Humphrey, FG's vice president for marketing. "It wasn't until then that we stopped to see what we had."
At the time it had too much. Profits in 1974 fell by $6 million from the year before, largely due to losses from two real estate subsidiaries. The company was also holding a number of banks it realized it didn't need. Since then, one real estate firm and several banks have been sold and Financial General's earnings have been climbing.
Steps to cut expenses were taken, as well, including centralized auditing and computer services. But the old philosophy at Financial General was to allow the 15 member banks as much autonomy as possible.
Middendorf isn't yet sure, he said, whether to change that policy or not. From both an image and cost saving perspective, there is much which argues in favor of centralization, he noted. On the other hand, he added, the banks in Financial General's family have gained a reputation as local, community-oriented institutions which too much centralization might destroy.
He has asked for studies: of a possible merger among the company's three large northern Virginia banks (Clarendon, Arlington and Alexandria), of further computerization, of a common name and common advertising budget for all of the banks in the group.
In the meantime, Middendorf has trimmed the corporate staff from 27 to 15. "We're down to basic engine room position," he remarked.