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California First’s Buyout of Union Bank to Cost 640 Jobs

From a Times Staff Writer

California First Bank’s acquisition of Union Bank of Los Angeles will result in the elimination of 640 jobs, mostly in Southern California, a spokesman for the San Francisco-based bank said Friday.

The cutbacks will equal 8% of the 7,965-member work force of the combined banks and are expected to take place over two to three years. Most of the cuts will be made by not filling positions as they are vacated naturally in areas where duplication exists between the two organizations.

“There will be no wholesale terminations,” said Larry Boggs, vice president and chief spokesman for California First.

Boggs acknowledged that some jobs will be eliminated fairly soon after the completion of the merger, which might lead to layoffs. But he said both banks have an annual staff turnover rate of 20% or higher, which should allow most of the 640 jobs to be cut through attrition.

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California First, which is 77%-owned by Bank of Tokyo, expects to complete its acquisition of Union Bank on Nov. 1. California First agreed in March to pay $750 million for Union to its British owners, Standard Chartered.

The newly merged bank will be called Union Bank. It will have total assets of $15 billion and be the fifth-largest bank in California.

California First operates 135 branches across the state and concentrates on serving individual consumers. Union Bank specializes in lending to businesses and its 32 offices are concentrated in Southern California.

As a result, most of the duplication in the banks will be in Southern California and most of the job reductions will be there, Boggs said. He added that head-office administrative posts and data-processing jobs are the most likely areas for cutbacks.

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California First is still studying whether any branches of either bank will be closed after the merger. Boggs said preliminary indications are that a few offices will be closed in cases where Union and California First have branches virtually side by side.


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