BANKING / FINANCE : Canadian Dollars Will Give Boost to Pacific Branches

Jerry E. Pohlman has big plans for the 11-branch Pacific First Savings in Costa Mesa, and with several hundred million dollars from Canada, he just may be able to carry them out.

Pohlman is the chairman of Seattle-based Pacific First Financial Corp., a large and solvent thrift that has been purchased by Royal Trustco Ltd. of Canada in a deal expected to close by the end of this month.

Royal Trustco, one of Canada’s largest trust companies (which are similar to U.S. savings and loans) has also acquired Pacific First--previously named Pacific Savings Bank--and plans to fold that operation into Pacific First Financial.

But that’s only the beginning, Pohlman explained during a visit to Orange County on Friday. Through Pacific First, Royal Trustco intends to expand rapidly up and down the West Coast, mainly through acquisitions, and build a retail-oriented thrift with $25 billion in assets and 200 branches within the next five years.

“The shakeout in the thrift industry is an opportunity for well-capitalized thrifts to come in,” Pohlman said. “A significant portion of our expansion will be in Southern California, and especially in Orange County. We’re looking at a number of institutions, branches and clusters of branches.”

Pacific First will be looking for bargains among the bankrupt thrifts that the Resolution Trust Corp. is disposing of, and will also try to nab pieces of healthy institutions that need cash to meet the new thrift capital requirements, Pohlman explained. Pacific First in Costa Mesa will serve as a regional headquarters to spearhead the Southern California expansion.

Royal Trustco, a conservative but highly regarded firm that is indirectly controlled by Edward and Peter Bronfman, is prepared to spend. Including the $224-million Pacific First acquisition, for which regulatory approval is expected next week, and the $47 million being spent to refinance Pacific First Savings, the Canadian company expects to invest $700 million to $800 million to build its U.S. base.

Pohlman, a professional economist who enjoys analyzing the macroeconomic aspects of the thrift crisis as much as developing a corporate strategy to exploit it, said Pacific First would attempt to compete with successful thrifts such as Great Western by developing a broad array of retail lending and investment services.

“Royal Trustco is good at manufacturing things like mutual funds, and we would hope that we could develop some unique products,” he said. And he also hopes that the Canadian parent’s international connections--the company has private banking interests in Switzerland and the United Kingdom--will give an “international flavor” to Pacific First’s investment options not normally found in a thrift.

If the plans succeed, Pohlman said, Royal Trustco will eventually take Pacific First public again while retaining a controlling stake. But that is still in the future, and Pohlman readily concedes that building a strong company on the rubble of a devastated industry will be no easy task. “There are a lot of opportunities in the near term, but we have to concentrate on quality,” he said.