For the second time in two years, First Public Savings Bank is in the process of being acquired by another Asian-American institution in Los Angeles.

First Public, whose 1994 agreement with GBC Bancorp was scuttled, has signed a definitive agreement with Cathay Bancorp. This time around, though, the deal will be worth less.

Cathay is paying $31.6 million, or $7.90 per share, in cash and stock, more than $7 million less than GBC's bid.

"It's interesting that while deal prices have clearly been going up, this one went down, despite the fact First Public seems to be a good clean, high earning bank," said Charlotte Chamberlain, an analyst with Wedbush Morgan Securities in Los Angeles.

First Public chief executive Marina C. Wang said she felt the decrease in price was the result of market forces, adding First Public shareholders were still getting a very good deal.

Officials at Cathay said the acquisition, scheduled to be completed in the fourth quarter, would make it largest Asian-American bank in California and possibly the nation. Through the end of first quarter 1996, the two institutions had combined total assets of approximately $1.5 billion and total deposits of $1.3 billion.

The merger has been approved by both companies' boards of directors but is subject to approval by regulators and First Public shareholders.

"First Public is extremely well capitalized, extremely clean, and earning a ton of money," Ms. Chamberlain said. "It looks as if Cathay picked a very good earner with quality deposits."

Cathay Bancorp chairman Dunson Cheng said he was excited about the opportunities presented by the deal.

"Adding First Public to our organization will allow us to expand our group of depositors and enhance our lending abilities," Mr. Cheng said. "Not only does First Public possess a similar customer base to our own, but it has been a consistent and growing performer over the years. We expect the transaction to be immediately accretive to our earnings per share."

Mr. Cheng added that an obvious benefit of the deal would be the substantial enhancement of Cathay's program in home mortgage lending, a First Public specialty.

First Public's deal with GBC fell apart in May 1994, when the Federal Reserve rejected the acquisition plan. The Fed recommended that instead of making the acquisition, GBC concentrate its management and financial resources on its General Bank subsidiary.

The current deal is valued at about 130% of book, higher than the 122% median price paid per California thrift in 1995, according to Ms. Chamberlain, but less than the approximate 140% of book value GBC offered two years ago.

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