Governor Josh Stein announced today that SMBC Group, one of Japan’s largest financial institutions, will establish its second U.S. headquarters in Charlotte to support its operations, creating 2,000 jobs over the course of six years. The company will invest $50.5 million in Mecklenburg County.
Governor Stein met with leaders from the company to recruit them to North Carolina during his business development trip to Tokyo last fall.
"Japan is one of North Carolina’s top economic partners, and I’m honored to welcome another, leading Japanese company to our state,” said Governor Josh Stein. “Charlotte, the second biggest banking center in the United States, will be an ideal home for SMBC’s second North American headquarters as the bank continues to grow.”
SMBC, with headquarters in Tokyo, is part of the Sumitomo Mitsui Financial Group, Inc. (SMFG), one of the three largest banking groups in Japan with more than 150 offices in nearly 40 countries and 120,000 employees worldwide. With roots that date back more than four centuries in Japan and 100 years in the U.S., the company offers a range of financial services, including banking, leasing, securities, credit cards, and consumer finance. SMFG conducts banking activities through its wholly owned direct subsidiary, SMBC. The Charlotte project will establish a major hub for the company to support the growth of multiple business units and expand its talent diversity.
“As SMBC continues to grow substantially in the United States, Charlotte is a standout location for us to invest in North Carolina for the long term in a major expansion that will establish our roots in the community,” said Hirofumi Otsuka, CEO for SMBC Americas. “A major financial services hub, Charlotte has a deep pool of talent that we will tap into and help build out as we position our bank for long-term success while contributing to the broader local economy. We appreciate the support of Governor Stein and other public leaders as we set out to create 2,000 jobs over the next six years."
“Charlotte is the premier destination for world-class financial services companies like SMBC to find talent and drive growth,” said North Carolina Commerce Secretary Lee Lilley. “Japanese companies are the top source of foreign direct investment into North Carolina, and SMBC is a welcome addition to the family of Japanese companies that call North Carolina home.”
Although wages will vary depending on each position, the average salary for all the new positions will be $165,316. The average wage in Mecklenburg County stands at $90,706.
The project will be facilitated, in part, by a Job Development Investment Grant (JDIG) approved by the state’s Economic Investment Committee earlier today. Over the course of the 12-year term of this grant, the project is estimated to grow the state’s economy by $13.4 billion. Using a formula that takes into account the new tax revenues generated by the new jobs and the capital investment, the JDIG agreement authorizes the potential reimbursement to the company of up to $70,032,000 spread over 12 years. State payments occur only following performance verification by the departments of Commerce and Revenue that the company has met its incremental job creation and investment targets.
The project’s projected return on investment of public dollars is 170 percent, meaning for every dollar of potential cost, the state receives $2.70 in state revenue. JDIG projects result in positive net tax revenue to the state treasury, even after taking into consideration the grant’s reimbursement payments to a given company.
Because SMBC chose a location in Mecklenburg County, classified by the state’s economic tier system as Tier 3, the company’s JDIG agreement also calls for moving $23,344,000 into the state’s Industrial Development Fund – Utility Account. The Utility Account helps rural communities finance necessary infrastructure upgrades to attract future business. Even when new jobs are created in a Tier 3 county such as Mecklenburg, the new tax revenue generated through JDIG grants helps more economically challenged communities in other locations around the state.
“Charlotte is a major center for international commerce, and it's a point of pride to add the SMBC name to our region's calling card," said N.C. Senator Caleb Theodros. “We look forward to supporting this great Japanese company as it puts down roots in our state."
"Many local, regional, and state economic development teams worked closely over many months to make today’s announcement possible,” said N.C. Representative Becky Carney. “We understand the complexities and needs of the financial services industry, and everyone in Charlotte and Mecklenburg County welcomes SMBC. We stand ready to help this company make connections and expand opportunities for people in our region.”
Partnering with the North Carolina Department of Commerce and the Economic Development Partnership of North Carolina on this project were the North Carolina General Assembly, the North Carolina Community College System, the Commerce Department’s Division of Workforce Solutions, the University of North Carolina at Charlotte, Central Piedmont Community College, Mecklenburg County, the City of Charlotte, Charlotte Center City Partners, and the Charlotte Regional Business Alliance.