Dealing with the stresses of loan quality, California Bank and Trust chief executive officer Robert G. Sarver lost his hair. Literally.

Mr. Sarver, whose bank comprises the California operations of Salt Lake City's Zions Bancorp., told two of his credit officers that if they could shave 20% off the level of nonperforming loans in the bank's commercial and real estate portfolios, he'd shave his head.

He's now bald.

"My wife is horrified about it," said Mr. Sarver, who admits he never expected to have to make good on the wager. "I didn't think they'd be able to do this, but I felt I needed to show my admiration for what they'd accomplished," he explained.

The banker, who used to sport substantial locks of sandy brown hair, bet the two employees that they would be unable to shrink nonperforming assets in their respective portfolios by 20% in the second quarter. They each did even better: Soured loans were reduced by roughly 40%, or more than $20 million, Mr. Sarver said.

His newly shorn pate has created some problems beyond Mrs. Sarver's displeasure. Last weekend California Bank and Trust completed the move of its headquarters from San Francisco to nearby Oakland. When Mr. Sarver visited the newly relocated data processing group, staff members did not recognize him.

"They called security," he said.

But a willingness to put it all on the line-hair included-in pursuit of results can be a powerful motivator, Mr. Sarver said. This could be especially true in newly merged banks, where culture clashes and other worries can dent morale. California Bank and Trust is the result of Zions' acquisition last year of Sumitomo Bank of California and Grossmont Bank.

"This is a good example of rewarding employees when they take ownership of their company," Mr. Sarver said. "When you're trying to merge companies and create a common culture, it helps to show you respect the values you set for your people."

Mr. Sarver will probably be working even harder at melding banking cultures in the near future, though it is unclear what kinds of bets he'll be placing. With the pending merger of Zions and its hometown rival First Security Corp., which was announced June 6, Mr. Sarver's responsibilities are expected to expand.

Though the lines of authority at the merged bank have not been decided yet, Mr. Sarver said he will probably become responsible for the new First Security's Arizona and Colorado operations, in addition to overseeing the enlarged, $40 billion-asset company's California operations.

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