A $3.6 billion-asset California thrift company said it has an agreement with the Office of Thrift Supervision under which it must reduce its exposure to rising interest rates, strengthen its loan underwriting standards, and fill two open spots on its board.

Los Angeles-based PBOC Holdings Inc. said it does not expect the order to affect its pending application to convert to a state-chartered bank. It has begun efforts to comply with the order, it said.

PBOC said it began tightening underwriting standards for consumer and commercial loans last year as it shifted focus away from residential mortgages and hired three top executives this spring to administer the consumer and commercial departments. PBOC president Rudolf P. Guenzel said the thrift had also started to reduce interest rate risk before the order.

Mr. Guenzel also said he soon plans to name two outside directors to round out the company's board at nine members.

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