A Washington State thrift is trying to become more like a bank with the help of a community bank it bought last year.

Officials of Walla Walla-based First Savings Bank of Washington Bancorp are hoping their acquisition of Inland Empire Bank will help them better serve their current customers and markets, while boosting lackluster earnings. First Savings eked out a return on equity of only 6.3% at March 31.

"Our plan for the last three or four years has been to become more of a community commercial bank as opposed to a thrift institution," said Gary L. Sirmon, president and chief executive officer of First Savings Bank. "To specialize in just residential lending has become so competitive that we find it difficult to meet our return on equity requirements with a narrow focus like that."

Since First Savings bought Hermiston, Ore.-based Inland Empire, thrift officials have tried to milk the expertise of the $155 million-asset bank in developing their own agricultural and commercial lending operations.

First Savings has 21 branches in southeastern Washington, while Inland Empire operates five offices in northeastern Oregon. Both areas are predominantly agricultural markets, but First Savings has remained a traditional mortgage lender for most of its 107-year history.

Now officials want to strengthen their relationships with depositors and homeowners by offering agricultural and commercial lending as well. They're also counting on getting deposit relationships from new agricultural loan customers. And they believe the acquisition will allow them to avoid starting from scratch.

"We haven't been able to offer those services to a big portion of the community because we weren't a commercial bank," Mr. Sirmon said. "We saw the acquisition of Inland Empire Bank as an opportunity to put that on a faster track."

Already, bank officials have helped the $825 million-asset thrift establish policies and procedures similar to their own. The thrift simultaneously transferred an experienced Inland Empire lender to its Tri- Cities division in Richland, Wash., last October to start up farm and commercial lending operations there.

And in Walla Walla, First Savings Bank hired away a commercial lender from a small, local competitor, who brought with him a "fairly significant book of business," Mr. Sirmon said.

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