Magazine article American Banker

'Problem' Tag Gone, L.A. Bank Dusts 'For Sale' Sign

Magazine article American Banker

'Problem' Tag Gone, L.A. Bank Dusts 'For Sale' Sign

Article excerpt

Bank Plus Corp. in Los Angeles is betting that a clean bill of health from regulators will help it finally find a buyer.

The $2.2 billion-asset parent of Fidelity Federal Bank announced Monday that the Office of Thrift Supervision has removed its "problem association" and "troubled condition" designations it slapped on the thrift company last fall after examining Fidelity's money-losing credit card operations, now discontinued.

Mark K. Mason, Bank Plus' president and chief executive officer, said the lifting of the OTS order validates that the institution -- which has been on the block for more than two years -- "has turned itself around."

"Overall, the institution has cured its substantial prior problems," Mr. Mason said in an interview Monday. "Because we resolved these issues on our own," a buyer "doesn't have to solve them, and that makes the company more attractive."

Christopher R. Raffo, an analyst with Hoefer & Arnett in San Francisco, said Bank Plus may not have to wait long.

"Last year Mark Mason said that" management's "intent was to clean the shop up, and so far everything that we've seen has confirmed that," Mr. Raffo said. "I'm confident that there will be end-buyers for this company."

The thrift, which hired the New York investment bank Sandler O'Neill & Partners last November to help it find a buyer, can trace most of its troubles to its subprime credit card operations. Its two credit card portfolios lost more than $70 million in 1998 and 1999 and spawned about 160 lawsuits from consumers in the Southeast, who claimed that third-party sales representatives made misrepresentations about the credit cards. …

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