A California industrial bank is overhauling its branch network to bring in more deposits and support a nationwide lending effort.
Imperial Thrift and Loan Association, Glendale, is consolidating its statewide branch network into six urban "superbranches."
The company once had 14 small branches, most of them in suburban strip malls. Now it will target urban financial centers through massive deposit- gathering offices.
Last month the $810 million-asset company closed two branches and a loan production office in the San Francisco area while opening a superbranch in the city's financial district. Two more branches, in San Jose and Sacramento, are also slated to be consolidated with the new office.
"My consolidation is by and large coming to a close," said Imperial chairman and chief executive officer George Haligowski. "We're well represented statewide in financial centers. That's what I wanted to accomplish, and we're there now."
The new branch raked in more than $1 million a day of deposits during its first three days. And Mr. Haligowski predicted it would hit $250 million in deposits within a year-doubling its current size.
Mr. Haligowski is trying to remake the company, which Imperial Bancorp of Inglewood, Calif., founded 24 years ago and sold to Japanese investors in 1983. The investors sold it in October 1995 in an initial public offering.
When Mr. Haligowski took the helm five years ago, the small branches were typically in small towns, including Upland and West Covina-"places you would not consider to be a financial center."
To get away from such neighborhoods, Mr. Haligowski consolidated the branches over the past four years into more profitable urban locations, in La Jolla, Costa Mesa, Beverly Hills, Encino, Glendale, and now San Francisco. "It's a philosophy that has worked well for us," he said.
Meanwhile, since the 1995 IPO Imperial has opened loan production offices in six cities nationwide. Two more are planned. Officials have also sought to diversify outside the thrift's charter, using some proceeds from an April 1996 offering to start up a mortgage banking operation in January called ITLA Funding Corp.
Imperial is now reporting the highest earnings in its history, posting a return on assets of 1.35%.
"We're very good at commercial real estate lending in California," Mr. Haligowski said, so "we decided to take the show on the road nationally. We're doing pretty good here."