SACRAMENTO, Calif. - Stan Hollen has turned Golden 1 Credit Union into an 800-pound gorilla.

Since he took the reins in 1984, Mr. Hollen has extended Golden 1's reach throughout California, more than quintupled its assets, and introduced automation that makes the institution a "fine-tuned lending machine."

The success of Golden 1 - California's largest credit union, with $1.6 billion of assets - has been accompanied by protests from banks as well as other credit unions.

Mr. Hollen, who describes himself as tough, makes no apologies.

"We're a lot more aggressive than the average credit union, but we're not the average credit union," said Golden 1's 45-year-old president and chief executive.

"Our reason for being is to serve our membership base," he said. "Our members desire leading-edge products and services, and that's what we're going to give them. I don't look at size as something we have to explain. I look at it as an indication of our success."

Merging has been the key to growth at the country's seventh-largest credit union. Mr. Hollen has overseen 16 acquisitions since taking the helm, most of them involving small institutions.

A decade ago Golden 1's operating area was basically confined to state employees of 14 Northern California counties. Now its 265,000 members include state, federal, and city employees across California, plus 900 other employee groups. The credit union reaches them through a network of 44 branches and 115 automated teller machines.

The Sacramento giant likes to pick targets based on markets in which it wants expand or establish its presence among government employees, Mr. Hollen said.

For example, nine years ago, Golden 1 had no branches to serve its 5,000 members in Fresno. In 1986 it merged with $20 million-asset Sequoia Central Credit Union. Shortly after that it merged with two smaller credit unions, including one that served hospital employees.

Golden 1 now has six branches in Fresno and 19,000 members.

Such a sustained acquisition strategy is unusual in the industry, and some credit unions consider Golden 1 a predator. Mr. Hollen denies this.

"There's no stock involved, so you can't buy a credit union," he said. "What motivates a merger is what's best for the members."

Golden 1's expansion in Fresno became more controversial in 1990 when it absorbed Internal Revenue Service employees previously served by First California Federal Credit Union. The $40 million-asset credit union accused Golden 1 of luring them away; Mr. Hollen replies that representatives of the group approached him because they wanted Golden 1's services.

"It's kind of hard to hide under a rock when you're large," Mr. Hollen said.

In other markets Golden 1 goes head-to-head against credit unions. Where Golden 1 has overlapping membership fields with another credit union, "We compete, we make no bones about it," Mr. Hollen said.

Nevertheless, Mr. Hollen said Golden 1 assists small credit unions through trade groups and provides direct assistance with equipment and planning.

Golden 1's size also rankles bankers, who see it as a stiff competitor.

"Their field of membership is overly broad," said David Taber, president of $125 million-asset American River Bank in Sacramento.

"They're a very, very strong competitor in terms of people who work for the state," which is a significant chunk of Sacramento's population, said Jim Culleton, president of First Commercial Bank. "We used to be located next to them and they were always quite busy."

Golden 1 shows no signs of slowing down. It keeps a lookout for new acquisition targets, and sometimes members are literally handed to it.

For example, California plans to hire 3,500 new corrections officers every year for the next five years.

"That's a tremendous opportunity for us," Mr. Hollen said.

Golden 1 has just completed negotiations to install ATMs in penal facilities, a move that will add 25 machines to its network by the end of the year.

The credit union also has placed point-of-sale terminals in eight state employee cafeterias, and plans to do so in eight more.

Mr. Hollen is a firm believer that financial institutions must keep up with - or better yet, drive - technology. Technology has enabled Golden 1 to crank out loans.

For example, Golden 1 moved to on-line credit scoring four years ago and now can approve a loan in five minutes, and make many loan decisions over the phone.

Golden 1 in 1993 introduced the first fully automated point of purchase lending system at a U.S. financial institution. The credit union developed the software and it has placed terminals in 80 car dealerships in the Sacramento area.

"The program gives us point of purchase availability and it takes the financing and insurance guy three to four minutes to complete the application," he said.

The program rakes in 275 car loans a week, Mr. Hollen said.

Mr. Hollen said Golden 1's program differs from typical indirect lending programs because the credit union pays dealers a flat $125 fee for originating the loan.

Always looking to offer new products and services, the credit union plans to roll out debit cards and home-banking systems later this year. It is also studying whether to offer smart cards, Mr. Hollen said.

Golden 1 is tough to beat when it comes to rates. Mr. Hollen said the credit union's used-car rate is about 300 basis points below the competitors', and there is a 150-to-250 basis point difference on new-car loans.

On the deposit side, Golden 1 prides itself on its regular savings account, which pays at least 100 basis points above market rates, Mr. Hollen said.

Golden 1 ended 1994 with an 84% loan-to-deposit ratio, highest of the 13 credit unions with more than $1 billion of assets, according to Callahan & Associates, a Washington-based consulting firm. The credit union's 1.5% return on assets was the second-highest in that group.

Beyond its traditional products, Golden 1 offers investments and investment management services through a subsidiary. Last year the operation generated $2 million a month in commission revenue.

"Investment products are a key area where they are focusing and doing extremely well," said Mr. Taber at American River Bank.

Whether being tough is a result of nature or nurture is open to question, but Mr. Hollen certainly picked up a few lessons from his previous job at Construction Equipment Federal Credit Union (now Citizens Equity Federal Credit Union), where he was a vice president under John Siefken.

Mr. Siefken, who has acquired a reputation for aggressiveness and bashing banks, built the credit union into a financial powerhouse in Peoria, Ill., from an institution that served employees of Caterpillar Inc.

One factor behind that credit union's growth was its extensive ATM network, which Mr. Hollen developed.

Mr. Hollen says his years in Peoria put "yellow paint in (my) veins," alluding to the color of Caterpillar's earth-moving equipment. Indeed, he has models of bulldozers and other monstrous machines on his office bookshelves.

Moving to laid-back California from the Rust Belt caused more than a little culture shock. He saw that he "needed to bring stronger work ethic" to the credit union, he said.

In short order, he centralized lending, cut operating expenses, and reined in an "out-of-control" data-processing system, he said. Two subordinates couldn't handle the pace or direction of the new regime; one left almost immediately, the other two years later.

Mr. Hollen said he has mellowed a bit over the years and as a manager delegates responsibility. But observers note that he still doesn't mince words.

"You can't have everyone like you," he said. "It's more important to have them respect you, and that applies to whether they're employees, competitors, or peers."

Not that Mr. Hollen doesn't loosen up and have fun. For instance, he plays on one of the credit union's two softball teams that compete in a league of financial institutions.

"We play against banks," he said, and proudly added, "Last year we won the league."

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