Charles Keating’s conference table has a new home in Tustin-based First Fidelity Investment and Loan’s boardroom. First Fidelity’s officers bought the walnut table at a used-furniture auction about five years ago. “It’s a beautiful table,” said Boyd Warner, First Fidelity’s senior vice president. Warner said the officers were reluctant to buy the table because of its history, but it fit their needs and budget.
“We’re putting the table to better use,” Warner said.
First Fidelity had an 80% growth in pre-tax earnings for the year in 1999, to $11.5 million, in addition to moving its headquarters to larger digs in September. It’s now in a light-industrial, mixed-use area, in a building tucked behind a Jack in the Box, next to a cabbage patch and the Tustin air base.
“Our digs are not particularly bank-ish,” Warner said, “We’ve shunned the ivory tower, marble and chrome to be lean.”
The bank has grown its assets from $225 million in 1995 to $558 million as of March 31, bouncing back after turbulent times in the early ’90s, when the bank’s then-president, Paul Ralser, had to shut down its lending operations to clean up its loan portfolio.
In 1997, Ralser moved the bank’s operations from San Diego to Irvine. A year later, Ralser handed over the president’s job to Chuck Thomas, who had been chief credit officer. Ralser remains chairman.
Thomas switched the bank from retail mortgage lending to wholesaling mortgages for multi-family units, ranging from $200,000 to $5 million.
Thomas also wants to move the bank “to more consumer-type lending,” he said. First Fidelity is an industrial bank, but will be offering auto, RV, home-improvement and home-equity loans by the end of the year.
On the deposits side, its current products are savings, CDs and IRAs, but it will be offering money-market accounts in the next two months. It is also looking to become more of a commercial bank, and will be offering business checking accounts, cash-management services, lines of credit and equipment-leasing services, Thomas said.
The bank’s employee count has grown from 40 in 1997 to 61 currently.
“We have to hire talented people,” Thomas said, adding he plans to hire five more staffers this year.
Eighty percent of the bank’s deposits come from CDs, which gives the bank a high cost of funds compared with the rest of the lending industry.
“It’s a real trick. The high-interest-rate environment makes it hard,” Thomas said.
The bank has branches in Orange and San Diego counties and in Arizona, and entered the Utah, Colorado and Northern California markets in 1999.
It had plans to move up the West Coast into Oregon and Washington, but those are on hold.
“The market is turning on us, with interest rates rising,” Thomas said.
Though the interest rates are hurting his business, Thomas said he has no qualms about what the Fed is doing.
“I am comfortable with his (Fed Chairman Alan Greenspan’s) fiscal policy. I think it is important for Greenspan to keep inflation in check,” Thomas said.
The bank is the sole subsidiary of Irvine-based First Fidelity Bancorp, which is owned by a group of investors including the Bass brothers of Texas.
