Gerald McQuarrie, S&L; Co-Founder, Dies
Gerald H. McQuarrie, co-founder of Downey Savings & Loan and one of the industry’s leaders, died at his home over the weekend of acute leukemia, the thrift announced Monday. He was 70.
McQuarrie, whose illness struck several months after he retired last July as chief executive officer, remained active and continued to work as Downey’s vice chairman until the disease disabled him two months ago. His wife and three children were with him when he died Saturday.
Downey co-founder Maurice L. McAlister praised his friend for helping make the institution one of the state’s larger thrifts and one of the nation’s best-run S&Ls.;
“Gerald’s genial manner and his abiding interest in Downey’s employees were hallmarks of his leadership as chief executive officer for 34 years,” McAlister said in prepared remarks. “We shall miss him.”
Others in the industry also praised McQuarrie.
“He’s one of the nice guys in the industry,” said Richard H. Diehl, chairman and chief executive of Home Savings of America in Los Angeles. “He and Maurice marched to the beat of their own drum, but they did a very good job. Gerry is one of the individualists that the industry could ill afford to lose.”
James F. Montgomery, chairman and chief executive of Great Western Bank in Chatsworth, said, through a spokesman: “Gerald McQuarrie was a fine man who ran his company well during difficult times for the savings and loan industry. We will remember him as an honorable businessman.”
One of McQuarrie’s closer friends, Leonard Shane, was upset over the death. Battling cancer himself for the last few years, Shane said he talked often with McQuarrie over the last few months.
“It’s a great tragedy to lose such a decent man,” said Shane, former chairman of now-defunct Mercury Savings & Loan in Huntington Beach.
Shane, who served a term as chairman of the U.S. League of Savings Institutions, worked with McQuarrie on industry issues through the trade group and through the California League of Savings Institutions, where both men also served. McQuarrie was a director for several years with both groups.
“Gerald was absolutely dedicated to what an S&L; was devoted to,” Shane said. “He was really interested in trying to improve the lot of Americans by helping them pursue the dream of home ownership.”
McQuarrie was an appraiser and mortgage banker when he met building contractor McAlister in 1956. Previously, each had tried separately to obtain a charter from the state to open an S&L.; Together, they won approval to open Downey in 1957 with the minimum amount of capital then required--$330,000.
McQuarrie said in an interview last summer that he put in $100,000--with $70,000 of it borrowed--and “never thought twice about it.”
“It was so interesting that the two of us got along so well,” McQuarrie said in the interview about McAlister. “I met him one day, and we started to work together the next. I also knew Mac was absolutely honest, and that was important.”
McQuarrie had reason to be concerned about a partner. After serving in the Navy in World War II, McQuarrie started an escrow company and expanded it to 21 offices statewide. But in 1950, his reserve unit was called into service for the Korean War. When he returned two years later, the people to whom he had entrusted the operation had let business slide to the point that only three offices remained.
Though McAlister and McQuarrie were very different in many respects and rarely socialized, they agreed on business matters as well as partners could.
“He’s a Baptist and I’m a Mormon,” McQuarrie said. “One of the first things we agreed on was that we wouldn’t make loans to liquor stores.”
That promise, however, had a loophole. Besides its traditional thrift business of making home loans, Downey became the biggest developer of neighborhood shopping centers in California and Arizona. Major grocery stores, which typically were the main tenants in the centers, sell beer, wine and liquor.
The 1989 federal law that restructured the thrift industry requires S&Ls; with such direct investments to sell them off by mid-1994, and Downey is in the final stages of complying with the law.
Today, Downey is a healthy institution with $3.8 billion in assets in an industry ravaged by a bad economy and outright fraud.
McQuarrie was born in Minorsville, Utah, and moved with his family to Compton in 1924. His father had been a broker in the potato industry, but, with McQuarrie’s mother, switched to real estate after moving to Southern California.
After graduating from Compton High School, McQuarrie obtained his real estate license and joined his parents in their business. He attended Compton Junior College and eventually took mortgage banking and other financial courses at Stanford University and USC.
McQuarrie is survived by his wife, Oneida; a daughter, Sandra Irene Spencer of Newport Beach; and sons, Gerald Brent of Newport Beach and Roger Scott of Provo, Utah; and eight grandchildren.
A funeral service is scheduled at 11 a.m. Wednesday at the Church of Jesus Christ of Latter-day Saints in Newport Beach. Burial will follow at Pacific View Memorial Park and Mortuary in Corona del Mar.
Gerald H. McQuarrie
Company: Downey Savings & Loan.
Title: Vice chairman, former chief executive officer.
Born: June 28, 1921.
Birthplace: Minorsville, Utah.
Education: Associate’s Degree in Business, Compton Junior College. Also studied at Stanford University and USC.
Military: U.S. Navy in World War II, Korean Conflict.
Family: Married Oneida Martin in February, 1946; the couple have three children: Sandra Irene, Gerald Brent, Roger Scott.
CAREER HIGHLIGHTS
1957--McQuarrie starts Downey Savings & Loan in October with partner Maurice L. McAlister. By the end of the first day, the fledgling thrift takes in $300,000 in deposits, and by the end of the year it has posted an “unheard of” $16,000 profit.
1971--Downey Savings goes public.
1985--McQuarrie heads Downey management team hired by regulators to operate the failed Butterfield Savings & Loan in Santa Ana.
1988--Downey acquires Butterfield with $281.1 million in federal assistance.
1989--Downey’s stock is at an all-time high and splits for the fourth time in five years.
1991--McQuarrie retires July 31 after 34 years but continues on the board of directors as vice chairman. Doctors discover in the fall that he has leukemia.
1992--McQuarrie dies May 30.
