A midwestern banker is bolstering his presence in California.

A group controlled by James F. Dierberg, president and owner of First Banks Inc., St. Louis, on April 2 acquired 8.6% ownership of SierraWest Bancorp, Truckee, Calif., according to a securities filing.

This transaction, the latest twist in Mr. Dierberg's three-year effort to buy into the world's seventh-largest economy, exemplifies how some community bankers are diversifying their businesses by acting in faraway markets as well as at home.

"Jim's style is very simple: He is a value buyer, and he has a long-term outlook," said Joseph A. Stieven, a banking analyst for St. Louis-based Stifel, Nicolaus & Co., which has done work for Mr. Dierberg. "You look at California; it is a huge economy all unto its own and there are not many independent institutions left there."

Other midwestern community banks have been vaulting beyond their borders to lucrative western markets in recent years. For example, Capitol Bancorp, Lansing, Mich., is set to open its second bank in Arizona this quarter; and Jefferson Savings Bancorp, Ballwin, Mo., has been snapping up thrifts in Texas.

Waupaca (Wis.) Bancorp. entered Texas in 1995 and is hunting for targets in California.

Mr. Dierberg made his first imprint in California in 1994, when First Banks bought two banks near Los Angeles. Several acquisitions later, First Banks has well over $500 million of assets in California.

"He's not even done yet," Mr. Stieven said.

Beyond California and Missouri, First Banks has units in Illinois and Texas.

Besides being an active bank acquirer, Mr. Dierberg thrives as a bank stock speculator. He acquired an ownership stake in SierraWest through an investment group he majority owns and controls called Investors of America LP, formerly Dierberg Four, LP.

Investors acquired the stake by purchasing $2.8 million of SierraWest debentures on Feb. 2 and converting them to 282,900 shares of common stock on April 2.

"It seemed like a good buy, so I bought it," Mr. Dierberg said in an interview.

Mr. Dierberg said Investors is usually passive after it takes a stake in a bank. He would not disclose the number of institutions in which Investors has a position.

Bill Fike, chief executive officer of $475 million-asset SierraWest, said discussions with Mr. Dierberg indicated nothing but beneficial investment intentions.

"He explained that he thought it was a very sound financial institution for purposes of investment," Mr. Fike said. "There's never been talk of anything different than that."

SierraWest, which has banking operations across the border in Reno, earned a 0.69% return on assets in the first nine months of 1996 and an 8.10% return on equity. It has built a large Small Business Administration- guaranteed loan program in recent years and is one of Northern California's most prolific such lenders.

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