Great American CEO Quits to Take Downey S&L; Post
Robert Kemper resigned Friday as chairman and chief executive of Great American Bank, the once-mighty San Diego-based savings and loan that was seized by the Office of Thrift Supervision on Aug. 9. Kemper is leaving to take the chief executive’s job at Downey Savings & Loan of Newport Beach.
Regulators and Great American board members said Kemper, 62, made a diligent but fruitless attempt in his 14-month tenure at the S&L; to save it from a takeover. Great American ultimately foundered in a tide of non-performing loans in California and Arizona, most of them tied to failed commercial real estate and apartment projects.
The voluntary resignation came as no surprise, since Kemper’s job is likely to disappear by early next year when regulators expect to liquidate Great American’s remaining assets.
J. Michael Berry, who was named managing agent of Great American by the OTS at last month’s seizure, said in a statement that Kemper declined an offer “to remain with the institution through resolution,” but he decided instead to “pursue another business opportunity,” a reference to the Downey job.
Michael Patriarca, regional director of the Office of Thrift Supervision in San Francisco, had nothing but positive things to say about Kemper on Friday. “He is a very able manager . . . . He’s a very careful and thorough guy with a real sense of perspective. He really knows how a financial institution operates.”
Kemper, a former Wells Fargo vice chairman, was hired with regulators’ blessings in July, 1990, to try to save the ailing thrift. In his 14 months at Great American, Kemper oversaw the sale of the thrift’s 130 California branches to Wells Fargo for $492 million, a sale that the thrift hoped would stave off a seizure.
Despite the gain from the sale, Great American proved a lost cause. The S&L;’s Arizona and California commercial real estate loan portfolios continued to worsen, and problem loans made up 25% of total assets at seizure. After losing $263.4 million in 1989, Great American lost $173 million in 1990 and about $117 million over the first half of 1991. The S&L; became insolvent early this year.
In a bid to save Great American, Kemper directed the massive downsizing of the S&L; to an institution with $8 billion in assets as of Aug. 1, contrasted with $15.4 billion in assets of as of June, 1990, shortly before he took the job. Great American’s payroll had shrunk to about 1,400 employees as of last month, from 3,200 in May, 1990.
Kemper left Wells Fargo as vice chairman in 1983 after losing out to Carl Reichardt for the chairmanship. He then became director of the National Center on Financial Services at University of California and later managing director of Gregory & Honemeyer, a merchant banking firm in San Francisco, two posts in which Kemper worked closely with regulators.
At Downey Savings, Kemper replaces Gerald H. McQuarrie, 70, a Downey co-founder who retired in July. The other Downey co-founder, Maurice L. McAlister, said Friday he plans to retire early next year as president of Downey Savings. Kemper’s salary at Downey was not disclosed. His salary at Great American was $400,000.
Kemper’s appointment also could go a long way toward mending any battered fences between Downey executives and thrift regulators. The two groups have come to loggerheads over audit issues in each of the last three years. Downey is a healthy thrift, with $4.1 billion in assets.
Also resigning Friday was Great American’s executive vice president and chief financial officer, F. Anthony Kurtz.
