Great American Will Shut 3 Bank Branches
Great American Bancorp, citing continuing losses, said Wednesday that it will close its three Southern California branches and consolidate all activities in its main Century City office.
The bank holding company has lost more than $1.3 million since the beginning of 1985, primarily because of the high cost of operating the branches, the firm said.
The company is closing its Great American Bank branches in Beverly Hills, Newport Beach and downtown Los Angeles, which were opened in the early 1980s during a period of ambitious expansion.
“The three offices to be closed have been a significant drain on profits,†said Jack A. Sweeney, chairman and chief executive. “By consolidating our operations, we will be able to reduce our overhead and operating costs and function more effectively in today’s competitive market.â€
Sweeney said that 1986 will be a year of “restructuring and consolidation†and that the bank will post a net loss for the year. The costs of closing the branches will be charged against 1986 earnings.
In the first quarter of this year, the company lost $384,000, compared to a loss of $211,000 in last year’s first quarter. Its full-year loss in 1985 was $947,000.
“They overexpanded; they’re retrenching; they’re trying to get out of brick and mortar,†said Jim Alexander of Alexander Securities, a Los Angeles brokerage house.
The consolidation program will be directed by President Jerome E. Farley.
The bank, with $89.7 million in assets, specializes in lending to professionals and small businesses.
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