Ex-Regulator Aims to Run Tight Ship at First Florida

Paul M. Homan is in his element as the new chief executive of First Florida Banks Inc. - in more ways than one.

A motorboat enthusiast, Mr. Homan, has moved to Tampa Bay on Florida's west coast, which he happily describes as "a water wonderland." It's been four years since Mr. Homan last owned a boat - on Lake Michigan, when he worked for Chicago-based Continental Illinois Corp. - "but I certainly intend to buy one here," he said.

At the same time, the former bank examiner finds his professional skills - heavily weighted toward fixing problem loan portfolios - much in demand at Tampa-based First Florida, which has lost $50 million in the past three quarters.

Rich in Poor-Quality Assets

First Florida's ratio of nonperforming assets to total loans and foreclosed properties stands at 6.2%, one of the highest in the region. "The bank has a single problem: a disproportionate amount of poor-quality assets," Mr. Homan said.

Since he took up his post at the end of August, Mr. Homan has been analyzing the loan portfolio, with a particular focus on commercial real estate, which accounts for most of First Florida's problems. "Whether the current [loan-loss] reserves are adequate is going to be very dependent on the local economy. I have no better view of the future, in that respect, than anyone else," Mr. Homan said.

First Florida, with assets of $5.8 billion, might have to increase its reserves above the current level of $125 million, or 90% of nonperforming loans. Even if that happens, Mr. Homan believes the company has enough earning power to return to the black, possibly in the fourth quarter, but certainly in 1992.

Mr. Homan, who began his career as a bank examiner in San Francisco, worked for the Office of the Comptroller of the Currency, off and on, for 18 years. In his most recent position at the agency, as senior adviser and policy group member, he helped develop the first interagency agreements on capital adequacy guidelines and uniform rating systems for all federally insured banks.

"What I like about the government is it gives you the opportunity to influence people and events and policies of much more import - particularly national import." Mr. Homan said.

Rewards of the Private Sector

The benefits of private-sector work, on the other hand, come from being able to achieve success that is direct and easily measured, he said. The stint at First Florida marks the third time Mr. Homan has taken a private-sector job - the first was serving as chairman and chief executive of Nevada National Bank in Reno from 1983 to 1985, the second as executive vice president at Continental Illinois from 1985 to 1987.

As head of First Florida, one of Mr. Homan's most important tasks is to cultivate a good relationship with the Lykes family of Tampa, which owns one-third of the stock. So far, so good. "They were instrumental in hiring me, and I haven't managed to get on their bad side in the few weeks I've been here,' Mr. Homan said.

He joined the bank on Aug. 20 as president and chief operating officer of the holding company and president and CEO of the major subsidiary, First Florida Bank. Two weeks later, he was given the additional title of chief executive of the holding company, replacing A. Bronson Thayer, a member of the Lykes family by marriage, who remains chairman of the holding company and its banking unit.

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