MAHONING VALLEY First Place Bank will begin operations Monday

By DON SHILLING
VINDICATOR BUSINESS EDITOR
WARREN -- A new name in area banking will be unveiled Monday.
First Place Bank will begin accepting deposits and making loans after one year of planning by bank officials who merged FFY Bank of Boardman and First Federal Savings and Loan Association of Warren.
"We've taken two organizations, dumped them on the table and taken the best practices of each," said Jeffrey Francis, former FFY president who now is chief operating officer of the new bank.
The result is the largest locally based financial institution with $1.6 billion in assets and 35 branches.
"We're local, but we've got the size," said Steven Lewis, First Place chief executive. "We can compete with anyone."
Commercial loans: One way the larger size is helping is by allowing the new bank to create a business services unit designed to beef up its commercial loan portfolio. Neither FFY nor First Federal alone could have afforded to put together such a deep, experienced staff, Francis said.
The unit is headed by Tim Beaumont, senior vice president of corporate services, who came over to First Place from Sky Bank. The staff has five people, and two more will be added.
First Place now has about $80 million in commercial loans, which is about 10 percent of its portfolio. Lewis said he would like to see that increase to 25 percent.
Because the Mahoning Valley is not a high-growth market, First Place is looking at commercial lending as an area where it can increase its assets, Francis said. It already has 23 percent of mortgage lending locally, so not much growth can be expected there, he said.
First Place legally became a new bank in December, but officials put off operating as one bank so they could make sure the proper systems were in place. Shareholders of both approved the merger last year.
Administration: First Place is splitting its administrative offices between the former FFY headquarters on Boardman-Poland Road and the former First Federal headquarters in downtown Warren. Senior officials are based in Warren.
Warren also has the finance, legal and consumer lending departments, in addition to back office staff that handles wire transfers and check processing. Boardman has the computer systems, marketing and mortgage lending departments.
First Place has between 60 and 65 workers at each location.
It is cutting 40 positions in the company to help it achieve $4 million in annual cost savings that were projected at the time of the merger. About $2.5 million of that savings was to come in salaries and benefits.
Francis said 23 people will be laid off, although 14 of those people were offered positions elsewhere in the company and declined. Severance pay for nine people who lost their jobs without an option is one month's pay for each year of service, up to 12 months' pay.
Other positions were reduced through attrition and a severance offer to longtime employees. That offer included one month's pay for each year of service, up to 24 months' pay.
Lewis, who was First Federal's chief executive, said the vision behind the merger was creating a bank that served both Mahoning and Trumbull counties.
"When I look at Youngstown and Warren, I see one market," he said.
Customers want the convenience of more branches, but it didn't make financial sense for either bank to build branches because both counties are saturated with offices, he said. It costs at least $1 million to build a branch and $25,000 a month to operate it, he said.
Both FFY and First Federal hadn't built a new branch since 1986, but they have opened them in grocery stores and taken over leased locations that were vacated by another bank.
Out of area: First Place has operations outside Mahoning and Trumbull counties, but it doesn't have immediate plans for new full-service branches in those areas either, Lewis said.
It has loan production offices in Akron, Medina, Norwalk and Mount Vernon and it has three full-service branches in Portage County from First Federal's acquisition of Ravenna Savings. It also has loan production operations in Ravenna.
Lewis said three more loan production offices will be opened by June but he wouldn't say where.
He said he expects First Place Financial Corp., the bank's holding company, to buy smaller banks to expand.