Magazine article American Banker

Bank Plus' Loan Portfolio Seen Hurting Plan to Sell

Magazine article American Banker

Bank Plus' Loan Portfolio Seen Hurting Plan to Sell

Article excerpt

Despite having an attractive Southern California branch network, Bank Plus Corp. may have a difficult time finding a buyer.

The $4.3 billion-asset thrift, based in Los Angeles, announced this month that it had hired Keefe, Bruyette & Woods Inc. to explore the possibility of a sale.

"I love their retail network, but they are just too expensive for the asset mix they have," said Babette E. Heimbuch, president and chief executive officer of Firstfed Financial Corp. Bank Plus has a 38-office network in the Los Angeles and Orange County markets.

"We haven't made any decisions," she said.

Firstfed, a Santa Monica thrift company with $4 billion of assets, was named by several analysts as the most likely potential buyer.

Bank Plus' stock is relatively cheap, trading at about eight times estimated 1999 earnings. The average multiple among the top 50 U.S. thrifts is 12.

But most of Bank Plus' loan portfolio is multifamily residential mortgages. Some, sources said, are backed by property of questionable value.

The company has also shifted its focus to subprime credit card loans, a relatively risky business line for a thrift.

Market watchers named Golden State Bancorp., which is merging with the parent of California Federal Bank, and Downey Savings and Loan Association of Newport Beach, Calif., as other potential bidders. Officials at those organizations declined to comment.

Making the search for a buyer all the more difficult is the low and flat yield curve and a market that has been hammering thrift stocks. …

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