Great American Completes Deal to Buy Colorado S

Great American First Savings Bank expanded its retail operations into Colorado by completing its previously announced acquisition of First Security Savings & Loan Assn., an insolvent Colorado S&L; with $58 million in assets, Great American said Tuesday.

Terms of the deal, negotiated with the Federal Savings and Loan Insurance Corp. and completed Monday, were not announced. However, the FSLIC agreed to protect San Diego-based Great American First Savings Bank from future losses generated by certain problem loans already on First Security’s books.

First Security, which has two branches in Grand Junction, Colo., reported a $1.6-million negative net worth and $52 million in assets in November when the Federal Home Loan Bank Board placed the thrift in receivership. However, Great American maintained that the deal negotiated with the FSLIC will not have a dilutive effect on its earnings.

Great American, which had $13.1 billion in assets before the acquisition, has another acquisition in the works, having signed a letter of intent to acquire an Olympia, Wash., thrift with $725 million in assets.

Great American now has 179 branch offices in California, Arizona and Colorado. If it completes its bid for the Olympia-based thrift, it will add 37 branches in Washington and Idaho.

Last year, Great American acquired Home Federal Savings and Loan Assn. of Tucson and Los Angeles Federal Savings Bank, adding 66 branches and $3 billion in assets to its operations.

Regarding future expansion into the Colorado market, Great American “has nothing definite right at the moment,” according to spokesman Kenneth G. Ulrich. “But it gives us a foothold in the state so we can look at any market in Colorado.”

The First Security acquisition will be handled through Great American’s Arizona subsidiary because that state allows banks and S&Ls; to acquire out-of-state institutions. California and Colorado have yet to sign a so-called reciprocal purchase agreement that would allow such an acquisition.

The Colorado thrift will be known as the First Security Savings Division of Great American First Savings Bank.