James Montgomery, Bank Exec and Financial Innovator, Dies at 78

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James Montgomery, a longtime bank executive who spent his life building financial institutions, has passed away.

The 78-year-old passed away on Dec. 13 in Rancho Mirage, Calif., after suffering from health problems in recent years.

For two decades, Montgomery was chairman and chief executive of Great Western Financial Corp., the parent of Great Western Bank that was bought by Washington Mutual in 1997.

Montgomery was born in Baldwin City, Kan.; his parents moved the family to Los Angeles when he was a teenager. He attended high school in the Canoga Park section of Los Angeles and worked part-time in nearby orange groves, his son, John, told American Banker.

He later served in the U.S. Army before attending U.C.L.A., where he graduated with a degree in accounting and played on the school's volleyball team, which won the national championship.

In 1957, Montgomery joined Price Waterhouse in Los Angeles. He started at Great Western three years later as assistant to the president before leaving the company in 1964 to serve as director and president of United Financial Corporation and its Citizens Savings and Loan subsidiary.

In 1975, Montgomery rejoined Great Western, which he turned from a struggling bank into what was then California's biggest savings institution by assets.

Montgomery, who was six feet four, made his mark as both a salesman and innovator.

He hired John Wayne and Dennis Weaver to cut commercials for Great Western, and acquired rights to put the bank's name on the building where the Los Angeles Lakers played in Inglewood, Calif. years before such deals became commonplace.

Under Montgomery's leadership, Great Western also pioneered the adjustable rate mortgage, an innovation that insulated lenders from swings in interest rates and allowed millions of Americans to buy homes.

Throughout his career, Montgomery immersed himself in public policy. He participated on behalf of the financial industry in passage of the Financial Institutions Reform, Recovery and Enforcement Act of 1989, which recapitalized the system of federal deposit insurance and revamped regulation of the savings and loan industry.

Montgomery also served as both a director of Fannie Mae and the Federal Home Loan Bank of San Francisco, as well as chairman of the Community Bankers of America.

"His wisdom will be sorely missed," Alan Greenspan, the former chairman of the Federal Reserve, said in a press release.

After retiring from Golden West, Montgomery founded the $246 million-asset Frontier Bank, which has offices in both Park City, Utah and Palm Desert, Calif.

"He wanted to get back into community banking and build a small bank where you could sit down with the bank president and have a cup of coffee," John Montgomery said. "He was a romantic and he loved Jimmy Stewart in 'It's a Wonderful Life.' He believed so much in the idea that if you can help more people own homes you strengthen the foundation of the country."

Montgomery later started a bank to serve the Hispanic community in Oxnard, Calif., that shuttered after trying to open amid the financial crisis.

"If you knew my dad, he never retired," John added.

Montgomery served as both a trustee of the Neighborhood Housing Services of America and director of the Local Initiatives Support Corporation, which works to provide housing for low-income families. He was the first recipient of the John Wayne Cancer Institute's "Duke Award" for service in the battle against the disease.

Montgomery is survived by his wife, Martha Jane, and his sons Michael, Jeffrey, John and Andrew, who is a banker with BBVA Compass in Abilene, Texas.

A public memorial service for Montgomery is expected to take place on Jan. 25 in Los Angeles. The family asks that donations be made to the John Wayne Cancer Institute.

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