Bank to Close Quake-Damaged Credit Card Unit in Simi Valley : Business: First Interstate division’s 500 employees will be transferred permanently to L. A. Workers had been bused there since January.

First Interstate Bank announced Friday that it will pull 500 employees out of its earthquake-damaged credit card center in Simi Valley and transfer them to a less expensive site in downtown Los Angeles.

The bank has been busing employees from Simi Valley to temporary quarters in the First Interstate building at 1200 W. 7th St. in Los Angeles since two days after the Jan. 17 quake.

Now the bank will make the move permanent, according to a prepared statement by Michael Walker, senior vice president and manager of the credit card division.

The temblor seriously damaged the interior of First Interstate’s 180,000-square-foot building at 1700 Surveyor Ave., Simi Valley. There, employees had processed credit applications, handled credit card accounts and provided other services to several million holders of credit and ATM cards.

The bank is rehabilitating the three-story building in Simi Valley, but plans to sell or lease it rather than move its 500 employees back in, Walker’s statement said.

“First Interstate Bancorp announced in March plans to significantly reduce the company’s expense levels over the next year,” the statement said. “As a result, the Bank Card Division needed to explore all possible options to reduce its operating expenses.”

Mayor Greg Stratton said Friday that the move might not be a bad thing.

“The good news is they have continued repairing the building and are very interested in getting it sold,” Stratton said. “We may be able to work with them in getting a new user in there, and the result, of course, will be that not only do the old (occupants) have a job, but the new ones will have a job too.”

Stratton said city officials began hearing about the planned move late last week.

City officials told bank executives “that the work force in Simi Valley is better than the work force you’re going to get in L. A.,” and that if employees leave the credit card division for other jobs to avoid the commute, they will be replaced by workers of a lower caliber, Stratton said.

“We’ve been talking to them and trying to convince them there’s other things they’ve got to consider (than cost), but their minds were pretty well made up,” he said.

The bank expects to save $3 million a year because of the relocation.

Division workers will be allowed to keep their jobs and continue living in and around Simi Valley if they choose. The bank will continue to provide free bus rides to the new offices in Los Angeles through July 31.

It will also continue through September to subsidize employees with children. Those workers had to pay more for child care because of the increased time spent on the commute, Walker’s statement said. And the bank will offer severance pay to workers who want to seek jobs closer to home.

The bank will also work closely with city and county officials and real estate brokers to advertise the Simi Valley building to prospective tenants and buyers, the statement said.

Stratton conceded that the city cannot offer potential occupants the types of tax breaks it often does to entice companies to build new buildings in the city.

But he said the building is equipped with a high-tech security system that might prove attractive to certain types of businesses.

It could serve “any number of businesses that deal in devices they want to keep secure, whether it be computers or records storage, or on-line retrieval systems.”

“We really hate to see First Interstate go, because they’ve been a good citizen in the community,” he said. “It’s like a neighbor moving away that was a good friend.”