Milwaukee Thrift Expanding in $132M Deal

Milwaukee's Mutual Savings Bank is reaching into northwestern Wisconsin with a deal to buy First Federal Bancshares of Eau Claire for $132 million in cash.

The deal would create the second-largest savings bank in the state, with $1.9 billion in assets, 53 branches in Wisconsin, and one in Minnesota's Minneapolis suburbs.

The search for new markets, particularly in the state's growing Mississippi River area, led Mutual to make the deal, said Michael T. Crowley Jr., president and chief executive of $1.2 billion-asset savings bank.

Just because Mutual Savings is mutually owned doesn't mean it's "brain- dead," Mr. Crowley said in an interview. "We have the same rationale as anyone else would in making an acquisition. We wanted to go into a new geographic marketplace."

Mr. Crowley said the bank intends to test the waters in the Twin Cities for further expansion.

Robert A. Kotecki, senior vice president of Friedman, Billings, Ramsey & Co., said the deal should help Mutual's position in the state and came at a good price - 1. 3 times book value - for First Federal shareholders. The $700 million-asset holding company had been rumored for months as trying to sell.

First Federal stockholders will receive $18.85 per share in cash upon completion of the deal in the first quarter of 1997.