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Is Wilmington losing its luster as a banking center?

Company officials have said in the past they had a hard time recruiting managers to Wilmington, where JPMorgan Chase & Co. is the dominant financial employer.

AAA Mid-Atlantic moved from Philadelphia to Wilmington in the mid-2000s, one of the last on a long list of out-of-state financial institutions to move significant operations to Delaware for its skilled workforce and business-friendly environment. JPMorgan Chase & Co., part of an earlier wave of banks that set up back offices in Wilmington to avoid usury laws and taxes in other states, now employs more than 10,000 in northern Delaware, but other big banks have reduced employment in recent years; most recently Barclays, which has said it will consolidate some Delaware operations to northern New Jersey
AAA Mid-Atlantic moved from Philadelphia to Wilmington in the mid-2000s, one of the last on a long list of out-of-state financial institutions to move significant operations to Delaware for its skilled workforce and business-friendly environment. JPMorgan Chase & Co., part of an earlier wave of banks that set up back offices in Wilmington to avoid usury laws and taxes in other states, now employs more than 10,000 in northern Delaware, but other big banks have reduced employment in recent years; most recently Barclays, which has said it will consolidate some Delaware operations to northern New JerseyRead moreDNREC

Barclays Bank says it plans to move 500 of its 2,000 Wilmington, Del.-area jobs to its newly expanded operations center in Whippany, N.J.

U.K.-based Barclays developed Wilmington as a hub for its U.S. Barclaycard business in the early 2000s, but company officials have said in the past they had a hard time recruiting managers to Wilmington, where JPMorgan Chase & Co. is the dominant financial employer, with more than 10,000 workers.

But a former Barclays professional insists the move has more to do with Barclays than with Wilmington. The executive credits the Whippany decision to a New York-based Barclays executive who has since left the company.

He also noted TD Bank, among others, has moved its credit card back office to the city in recent years, and rivals, including card offices for Citi, PNC and other banks “are actively hiring.”

Bank of America, BlackRock, BNY Mellon, Capital One and M&T Bank also have significant Wilmington hubs, though BofA in particular has left most of the buildings in the city’s downtown which the former MBNA Corp. occupied when BofA bought it in the mid-2000s. BofA’s card operations still occupy the former DuPont Co. engineering center near Newark and other suburban Delaware locations.

The state became a credit card and wholesale-banking center after the 1981 passage of the Financial Center Development Act, which lifted interest-rate limits (usury laws) and taxed bank profits at regressive rates (the more a company makes, the lower its tax rate.)

Delaware politicians of both parties -- led by former Gov. Pierre S. du Pont IV, and including longtime U.S. Sen. turned Vice President Joe Biden, now the Democrats’ early frontrunner in the race to oppose President Trump next year -- defended the credit card industry’s interests in Washington as well as in Dover, as card loans grew rapidly in the 1990s and early 2000s.

But bank consolidation and automation have flattened or reduced employment at many of Delaware’s financial employers, and managers complain it’s tough to get young people to move to Wilmington. Some move to Philadelphia’s lively downtown neighborhoods, and commute to Delaware for work.

In an effort to make the town more attractive to out-of-state residents, Delaware has increased service subsidies for Septa commuter trains to Philadelphia, and is trying to get MARC to extend a commuter line north from Maryland and Washington.

Delaware has also attracted a growing fintech sector led largely by former credit card managers and technologists.