Luce Says He Will Retire as Chairman of Great American

SAN DIEGO — Gordon Luce, chairman and chief executive of Great American Bank, said Thursday he will retire this year, once the embattled S&L; finds a replacement.

In making the announcement at Great American’s annual shareholders’ meeting, Luce acknowledged reports that have circulated for weeks that he plans to leave the S&L; this year. Although the S&L; has no mandatory retirement age, Luce will turn 65 in November. He has been Great American’s chief executive since 1969 and chairman since 1979.

An executive search committee is looking for a new chief executive, Luce told shareholders. As reported earlier, Luce confirmed that Federal Home Loan Bank of San Francisco President James Cirona has been offered the job. But Cirona removed himself from consideration after he and the S&L;’s board of directors failed to agree to terms.

“The search is not yet concluded, but, when it has, there will be a prompt announcement of my successor,” Luce told shareholders. “It is time for change, and perhaps a new perspective will assist the bank in moving forward in these changing times.”

In his 21 years at Great American, Luce built the thrift from an obscure four-branch institution then known as San Diego Federal to the eighth largest S&L; in the nation, currently with $15.4 billion in assets and 211 branches. He introduced an array of marketing and customer service innovations and established a branch network that became the envy of many California financial institutions.

Luce also enjoyed high standing within the S&L; industry, partly by virtue of his strong political ties to Ronald Reagan, who, as California governor, named Luce state secretary of business and transportation. When Reagan was President, he appointed Luce to a United Nations post.

But Luce’s accomplishments at Great American have been overshadowed in recent months by the financial problems that have brought the institution close to insolvency. Most of the problems stem from Great American’s 1986 acquisition of Home Federal Savings of Tucson, from which Great American has reaped a harvest of problem loans.

Those bad loans were a major cause of Great American’s 1989 losses totaling $263.4 million. As a result, Great American has been weakened to the point of facing regulatory seizure unless it can find a merger partner or buyer, or raise $350 million in outside capital by the end of the year. Great American stock has dropped to Thursday’s close of $2.25 from a high over the past 12 months of $14.875.

Citing the five shareholder lawsuits that have been filed against the S&L; and its executives, Luce and other Great American executives declined to answer many shareholder questions on the S&L;’s finances. Much of Luce’s prepared speech was taken from previous regulatory filings.

Two dozen shareholders questioned Luce and other executives closely about the plunge in Great American’s stock price and looming threat of a government takeover, but few were openly hostile.

“What’s remarkable about the meeting is what didn’t happen, that shareholders didn’t tear the arms and legs off management, given that the stock has been the worst performer in San Diego over the past year,” said Blaine Roberts, president of La Jolla-based Morgan, Roberts & Co., an investment firm with a stake in Great American.

“It just goes to show the remarkable amount of good will on the part of the community toward the company,” Roberts said.