three-state branch and ATM network over the last seven years. Now it has sold almost all of it. Privately held Berkeley, based in Palisades Park, built the 26-branch network for just $24.7 million. But the thrift's management has refocused on a profitable asset-disposition business and on lending to credit- impaired borrowers. Officials at the thrift have told analysts that they hope to increase their portfolio of nonperforming assets from around the country, which they buy at significant discounts. Berkeley also wants to expand traditional lending to hotels and other out-of-favor market areas. Officials could not be reached for comment before press time. Since 1991, the company, which is owned by a Palm Beach, Fla., investor group, Ocwen Financial Corp., has purchased more than $1.7 billion in discounted loans. It was the nation's fourth-largest acquirer of such loans last year, according to Liquidation Alert, a weekly real estate newsletter. "They really view themselves as more of a finance company and a buyer of distressed assets and lender of distressed assets, not a mom-and-pop thrift," said Rob Schwartzberg, an analyst with Friedman, Billings, Ramsey & Co., in Arlington, Va. With the new focus in mind, the company has been quickly dismantling the physical franchise it built up from 1988 to 1993 from acquisitions of failed thrifts in New Jersey, Maryland, and Delaware from the Resolution Trust Corp. In two transactions this year, the $1.5 billion-asset company sold 25 of its 26 branches, with more than $1 billion in deposits, to Wyomissing, Pa.- based Sovereign Bancorp. Then Berkeley announced this month that it would sell its 118 ATMs to Princeton-based UJB Financial Corp. for an undisclosed price. Company officials told analysts that the thrift was actually losing about $6 million to $7 million annually because of a surge in rival ATMs in its market area. The three sales leave the company with one branch in New Jersey, plus about $486 million in discounted nonperforming loans and another $157 million in foreclosed real estate. The company also has about $147 million in performing loans to credit-impaired borrowers and $184 million in traditional mortgages and commercial real estate loans, as well as investments in low-income-housing tax credit partnerships. The transactions also virtually eliminated Berkeley's deposit base, but officials have substituted more than $1 billion in certificates of deposit originated through investment bankers. "I wouldn't view it as downsizing," said Elizabeth A. Summers, bank analyst at Ryan, Beck & Co. "It's just shuffling their investment portfolio."

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