MTB recently took on massive premises purchase, followed by huge turnover slump
Manfra, Tordella and Brookes, the Top 5 New York gold exchange depositor which announced last night it will not be able to deliver metal until further notice due to force majeure, decided to move from renting to the purchase last February of a ritzy condominium in the Extell Development’s new International Gem Tower. But then in May the firm was badly hit by the slump in precious metal sales.
MTB, one of only five US outfits with a license to deliver gold, holds 29,276 troy ounces of gold according to data from Comex. Comex’s owner CME declared what’s called “force majeure” an act of God (but not Mammon) that frees MTB from liability due to events beyond its control.
The company did post on its website about having “sustained substantial damage” a fortnight ago. And naturally, anyone can still get The Real Thing delivered via Brinks: plus, MTB is responsible for any additional costs incurred by customers who want to use that process.
But this afternoon, I find myself wondering what will happen if (or when) everyone suddenly decides they want their gold right now.
MTB is a privately owned bank still largely under the control of the Tordella banking family. Its chairman is Frederic N. Tordella. It converted to being a retail bank in 1993.
In February of this year, it took on a new not-yet-finished office condominium in the International Gem Tower. There it will buy the condo – and double its premises size to more than 10,000 square feet on the third floor – with another 2,500 square feet of below-grade space – in the now rising 34-story, mid-block tower on West 47th Street. According to Raizy Haas, senior vice president for development at developer Extell, “They were a little nervous about buying space and moving their operations. They took a long term view and became comfortable with the fact that they were going to own rather than rent.”
Nobody was available to comment today about whether the level of comfort had gone up or down. However, what we can be sure about is that MTB President Mike Kramer told the London Financial Times last May, “There are days here where we wonder if the phones are working”. At the time, he estimated that sales of gold, silver coins and small bars had fallen 50% in the previous two months.
File this one under ‘informed speculation’.
Postscript: At 9/11, MTB had its gold stored under the World Trade Center.