Ohio Officials Awaiting Bid for Home State

State officials arranging a rebirth of the closed Home State Savings Bank on Tuesday awaited a last-minute bid from Cincinnati-based American Financial, which faced a midnight deadline to make a purchase offer.

While officers of American Financial refused to discuss their plans, state officials said the company’s officers spent the weekend and Memorial Day examining Home State’s records.

“They would not be spending that kind of time and money, if they were not very serious,” said Thomas L. Kaplin Jr., the state-appointed conservator for Home State. “The kind of work they are putting in indicates they are going to make a bid.”

One Other Suitor

The only other suitor for Cincinnati-based Home State is Chemical New York, parent of New York’s Chemical Bank. Two other Ohio companies, Western-Southern Life Insurance of Cincinnati and Transohio Financial of Cleveland, bowed out of the bidding last week.

Robert McAlister, Ohio’s superintendent of savings and loans, said the state could decide as soon as Wednesday who would be the purchaser of Home State, which has 33 offices in the Cincinnati, Columbus and Dayton areas.

“For the first time in the entire Home State matter, we have two entirely able and sound institutions in the bidding,” McAlister said. “My reading is that, at this point, it’s neck and neck and the race is going to be won by a nose.”

Depositors have been cut off from their money since Home State closed two months ago.

Transohio did not disclose its reason for withdrawing from the Home State bidding. But Western-Southern Chairman Charles M. Barrett said his company did not have enough time to evaluate Home State’s books and make an offer.

The deadline for bids by Ohio companies was spelled out as part of legislation that the Ohio General Assembly approved that would permit Chemical to purchase Home State. For Chemical, Home State offers a foothold in Ohio’s financial markets.

Promises to Make Good

Under the legislation, the state would contribute up to $125 million to the Home State purchase to protect Chemical against unforeseen weaknesses in the thrift. In return, Chemical promises to make good on all of the depositors’ money in Home State and to pay a $21-million premium for entering the Ohio market.

Chemical officials have said they also intend to pump $30 million into Home State to strengthen it.

Home State, owned by Cincinnati financier Marvin L. Warner, closed in March after runs on its accounts by depositors alarmed at the news of the March 4 court-ordered closing of ESM Government Securities of Fort Lauderdale, Fla., in which Home State had heavily invested.

Home State’s closing prompted runs at other privately insured savings and loans, and Gov. Richard F. Celeste ordered all of them closed temporarily March 15. Most have since reopened after acquiring federal deposit insurance or merging with a federally insured company.