WARREN First Place Financial says it's still looking to grow

It just acquired a Michigan Bank, expanding its commercial loan portfolio.
THE VINDICATOR
By DON SHILLING
VINDICATOR BUSINESS EDITOR
WARREN -- First Place Financial Corp. remains eager to grow if it can find the right deal.
The Warren-based holding company for First Place Bank just announced the acquisition of a Michigan banking company but still is willing to buy another bank while that deal is pending, said Steven Lewis, First Place president and chief executive.
"I don't think we are on the sidelines. We are in the position to move forward if an opportunity presents itself," he said.
He said First Place executives spent 2000 and 2001 smoothing out the merger that combined First Federal Savings and Loan Association of Warren and FFY Bank of Boardman.
Not only do they have the experience of that and other acquisitions, but they have recently bolstered the company's executive ranks with officials from other banking companies, he said.
"For the first time in a long time, we have a deep bench," he said.
Latest deal
The deal announced Monday would unite First Place with Franklin Bancorp of Southfield, Mich. Franklin shareholders would receive $82.2 million in cash and stock under the deal, which is expected to be completed next spring.
Franklin Bank would become part of First Place Bank, and its five branches would retain the Franklin name.
A key to the deal is Franklin's commercial loan portfolio, Lewis said Tuesday in a conference call with stock analysts.
The deal would boost the value of First Place's commercial loans from 13 percent to 30 percent of its total loans. The company has had a long-term goal of having one-third of its loans in the commercial category.
As a savings and loan, First Place traditionally has done mostly residential real estate lending, but has been looking to boost other areas of its business in recent years.
Lewis said Franklin has made some bad commercial loans recently, but First Place executives are satisfied those problems have been resolved. Franklin began to have problems about 18 months ago when its chief lending officer died, Lewis said.
He said he has confidence in Craig Johnson, who was named Monday as president of Franklin Bank. Johnson may assume control of all commercial lending at First Place, Lewis said. Johnson, who joined Franklin in June, had been executive vice president of Franklin and previously was president of commercial banking for Republic Bancorp.
Lewis said the deal is good for First Place because Franklin is the only sizeable community bank in Oakland County in suburban Detroit. Other banks in that area are regional banks, which are much larger. The bank nearest in size to Franklin in that area has $10 billion in assets, compared with $500 million for Franklin. First Place now has $1.7 billion in assets.
"There is formidable competition, as there is in any market, but we think our style of banking will be well received," Lewis said.
Beyond the Valley
First Place has been expanding outside the Mahoning Valley because it is not a growth market. It has opened 12 loan production offices throughout Ohio, which accounted for 59 percent of its $1 billion in new mortgages in its last fiscal year.
Oakland County has the highest per-capita income in Michigan and is ranked in the top 1 percent nationally.
Franklin, which is a commercial bank, has good name recognition in the county but hasn't pursued much business with homeowners, Lewis said. First Place's experience and loan products will help Franklin expand that business, he said.
First Place said the merger would reduce Franklin's operating costs by $4.3 million, including $2.1 million in salary and benefit reductions. Lewis said reductions would be made in Franklin's administration offices but didn't offer any specifics.
shilling@vindy.com