Challenge for Turnaround Pro At Chicago Home Loan Bank
Since embarking on a banking career in 1969, Alex J. Pollock has endured extreme ups and downs at three institutions that were near collapse or were sold.
Those experiences should serve him well in his new job as president of the Federal Home Loan Bank of Chicago. It is one of the smaller and least-profitable of the 12 regional home loan banks, all of which are facing major challenges to survival.
The Chicago bank has 269 members in Illinois and Wisconsin. Most are well capitalized and profitable but have had little appetite for the home loan system's core product: loans.
Must Expand Membership, Sells Loans to Them
Mr. Pollock faces such tasks as recruiting commercial banks and credit unions, which have been allowed to join thrifts as Home Loan Bank members since 1989. He must also boost earnings, chiefly by encouraging more credit advances to members.
With 22 years of banking background, as well as a reputation as an incisive economist and financial industry pundit, Mr. Pollock is confident he can draw up a long list of prospective members.
"All my old friends in the commercial banking business in Illinois and Wisconsin can look forward to seeking me," the executive promised in a recent telephone interview.
Selling the Chicago Home Loan Bank's services will not be easy. Commercial banks may be attracted to the potential dividend income from holding Home Loan Bank stock, but Chicago has been paying the lowest rate in the system, averaging 7.62% in 1990.
Mr. Pollock's roots in commercial banking should prove an asset, said Thurman C. Connell, his counterpart at the Federal Home Loan Bank of Des Moines. It will get Mr. Pollock "in the door quicker," Mr. Connell said. "He knows who the decision makers are and has good rapport with them."
Daniel F. Evans Jr., chairman of the Federal Housing Finance Board, which oversees the Home Loan Banks, said he is impressed with Mr. Pollock's experience. Mr. Evans wants the Chicago bank to increase lending to "retain their relevance."
Mr. Pollock worked 16 years at Continental Bank in Chicago. After managing branches in Belgium and Germany in the early 1970s, he returned to the United States and rose to senior vice president for corporate planning, research, and development.
Departing Troubled Continental for Marine Bank
When energy-related loans brought Continental to the brink of failure in 1984, Mr. Pollock was appointed to the turnaround management team, but he resigned in 1985.
He joined Marine Bank, Milwaukee, in 1986, and rose to president, only to see it sold a year later to Banc One Corp.
In 1988, he took a stab at turning around Community Federal Savings and Loan Association, the largest thrift in St. Louis, which he recalled was "insolvent, demoralized, and heading rapidly downhill."
In 2 1/2 years, he trimmed expenses, boosted income, and shrank assets by one-third, to $2.2 billion. It was sold last year to Boatmen's Bancshares Inc. under the government's accelerated resolutions program -- but not before Mr. Pollock earned high marks for tidying up the balance sheet and making the institution attractive to buyers.
Since the sale, Mr. Pollock had been a visiting scholar at the Federal Reserve Bank of St. Louis.