Great Western Sells Branches in W. Florida : Banking: It’s giving up operations in that part of the Sunshine State to focus its efforts elsewhere.
Great Western Bank changed gears Monday in its much-publicized move into Florida, announcing the sale of its 31 branches in the western portion of the state to First Union National Bank of Florida for about $75 million.
Great Western has bought several institutions in Florida over the last few years in an effort to diversify from its California base. The company said that selling its operations on the western side of Florida will enable it to focus on expanding in the central and southeast portions of state, where it has 119 branches.
Great Western, based in Chatsworth, also said it could not justify keeping the 31 branches because the relatively small size of the group prevented it from enjoying the economies of scale needed to meet the bank’s financial objectives.
“We had hoped to fill out the network in the western part (of Florida) by making other acquisitions, but now we think it would be better to focus on developing our business elsewhere in Florida,” said Gordon Turner, a Great Western vice president.
Although First Union will be purchasing all of Great Western’s retail banking offices in western Florida--a region that includes the fast-growing Tampa-St. Petersburg market--Turner said the bank will keep its six home-loan offices in the area.
Great Western had only a small presence in Florida until 1990, when it bought 71 branches of the failed CenTrust Savings Bank and 18 branches of the failed Gibraltar Savings Bank from the Resolution Trust Corp. for about $90 million.
Many of the 18 former Gibraltar branches are among the offices that Great Western is now selling to First Union, Turner said. Great Western said it will realize a gain of about $60 million from the deal.
Great Western’s stock rose 62.5 cents Monday to close at $23.75, a 1994 high. It had traded as low as $15.25 earlier in the year.