Wells Closing 25 of Its O.C. Branches and Laying Off 187

Wells Fargo & Co., shedding a surplus of offices after acquiring First Interstate Bank, said Wednesday it will close 25 branches in Orange County and lay off 187 branch employees.

Among the branches to be closed are the Birch Street complex in Newport Beach near John Wayne Airport and the office tower at The City shopping mall in Orange.

Statewide, the bank will close 260 branches and lay off about 2,000 branch employees, said Wells spokeswoman Kim Kellogg.

Wells is keeping open about two dozen more offices than anticipated. Coupled with 61 offices sold at the end of March, it expects to eliminate 321 branches from its network by the time all the closings are complete Sept. 1.

The bank kept the additional locations to create smaller branch centers, which offer basic checking, saving and lending services but not services such as safe deposit boxes.

“The market justified keeping a presence in certain areas,” Kellogg said. A Wells branch on Camino de los Mares in San Clemente will be turned into such a center.

With one of the nation’s biggest bank buys under its belt April 1, Wells is moving quickly to integrate the First Interstate system and streamline operations.

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Wells Fargo customers don’t appear too concerned about the branch consolidations. “As long as they keep one,” said Judy Castillo of Anaheim.

First Interstate employees at 34 Orange County branches, though, have been anxious about their fate. They were told Tuesday night and Wednesday whether their branches would be closed.

Of the 25 local offices to be shuttered, 18 are former First Interstate branches and seven are Wells offices. Each is being consolidated into a nearby location, giving Wells about 85 sites in the county.

At the Wells Fargo branch at Harbor Boulevard and Lincoln Avenue in Anaheim, workers were surprised to learn that their office was closing in favor of a First Interstate branch down the street.

“I thought we’d stay, and [the manager] thought the same thing,” shrugged a teller. “Hopefully, I’ll have a job over there. It’s the first time I’ve been through this.”

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Kellogg said Wells executives chose First Interstate sites over 87 Wells locations statewide because the First Interstate branches offered better amenities, such as parking and customer access.

“We’re lucky. We get to stay open,” said a First Interstate worker at the Santa Ana branch at Warner Avenue and Main Street. “Everyone is excited. The Wells Fargo branch is going to come here.”

That, however, doesn’t ensure jobs for First Interstate employees, who are expected to bear the brunt of the layoffs. Wells said it would interview both First Interstate and Wells branch employees to determine whom it would keep. Wells will decide by May 15 which workers will be dismissed.

Those workers will then have a chance to interview for about 900 job openings that now exist, Kellogg said. Wells froze most hiring in October when it launched its hostile takeover bid, and First Interstate froze hiring in December. Attrition since then has created vacancies.

Branch employees to be laid off will have jobs at least until Sept. 1. Some of the employees will remain through the end of the year to complete the transition, Kellogg said.

Wells already has announced the dismissals of 1,700 administration and headquarters employees, and it still expects to lay off a total of 7,200 workers by the end of the year, she said.

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Few of the shuttered branches are expected to be picked up by other banks, say industry consultants.

“Several branches would make excellent locations for other banks,” said Edward J. Carpenter, an industry consultant based in Irvine. “People are used to going there to do banking and will want to continue going there.”

More importantly, he said, some of the buildings and the locations “just can’t be duplicated.” Even so, other banks would be interested in only a handful of the sites, he said.

Empty bank branches have been favored mostly by Blockbuster Video, which has gone into more vacant bank buildings than any other company, Carpenter said. Wherehouse, Tower and Virgin Megastore record outlets are close behind, with restaurants following them, he said.

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Meantime, other banks have been quick to pick up First Interstate customers who don’t want to move to Wells, said banking lawyer Gary Findley, a principal in the Findley Group banking consultants in Anaheim.

At Glendale Federal Bank, a savings and loan, manager Dawn Miller had put up banners and a sign three months ago to attract First Interstate customers. Upon hearing that Wells was closing a branch across the street, she began planning her next move. “It may be the golden opportunity for us right now,” she said.

“Everybody’s been having a significant increase in business,” Findley said. He expects Wells to lose 12% to 15% of its combined business, which he said would be normal for such a large merger.

But even that much business has whetted the appetites of other banks and helped to encourage would-be bankers.

“In the next 18 months,” Findley predicted, “I expect to see two new banks open in Orange County.”

Times staff writers Don Lee and Debora Vrana contributed to this report.

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Effects of Merger

Wells Fargo will close 18 First Interstate and seven of its own branches in Orange County. The closures will result in 187 layoffs. Where branches will close:

FIRST INTERSTATE

Brea

* 685 S. Brea Blvd.

* 280 S. State College Blvd.

Corona del Mar

* 3141 E. Coast Highway

Costa Mesa

* 3029 Harbor Blvd.

Dana Point (Monarch Beach)

* 5 Monarch Bay Plaza

Fullerton

* 315 N. Harbor Blvd.

Garden Grove

* 9917 Chapman Ave.

* 12518 Valley View St.

Huntington Beach

* 19950 Beach Blvd.

* 200 Main St.

La Habra

* 1201 W. Imperial Highway

Laguna Beach

* 381 4th St.

Laguna Hills

* 24032 El Toro Road

Lake Forest

* 23646 Rockfield Blvd.

Newport Beach

* 5000 Birch St.

* 1 Civic Plaza

Orange

* 1 City Blvd. West

* 1344 N. Tustin Blvd.

WELLS FARGO

Anaheim

* 5550 E. Santa Ana Canyon Road

* 100 N. Harbor Blvd.

Huntington Beach

* 96 Huntington Center Drive

Mission Viejo

* 25276 Marguerite Parkway

Newport Beach

* 3201 Newport Blvd.

San Clemente

* 601 N. El Camino Real

Santa Ana

* 1702 S. Grand Ave.

Source: Wells Fargo Bank, Findley Cos., Researched by JAMES S. GRANELLI / Los Angeles Times

Consolidation Cuts

Mergers and acquisitions have reduced the number of banks in Orange County. Annual average bank branches:

1991: 427

1992: 452

1993: 401

1994: 398

1995: 404

How They Compare

Before their merger further reduced the number of banks branches, First Interstate’s nationwide profile was much higher than that of Wells Fargo; Wells was more dominant in Orange County. A 1995 comparison:

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First Wells * Branches Interstate Fargo Orange County 34 77 Total 1,140 861 * Employees Orange County 421 996 Total 27,200 19,400 * Deposits* Orange County $1.8 $2.9 Total $50.2 $38.9

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* In billions

Source: Findley Cos.; Researched by JAMES S. GRANELLI / Los Angeles Times