Orange City Bank’s New President Shakes Up Staff

Orange City Bank, purchased three months ago by a Colorado financier, is shaking up its management team in an effort to serve customers better and to put a lid on costs, said William Diethrich, the bank’s new president and chief executive officer.

Since it was taken over by Martin List, a former Newport Beach physician who now runs a development business in Colorado Springs, the bank has lost its president, its executive vice president and the manager of its Orange branch, the largest of three offices.

But the departures have helped Diethrich put his own imprint on the bank. He has named three persons to newly created mid-management positions, has replaced the manager in Orange and has been looking for someone to take over his old post as senior credit officer.

More Middle Managers

“I lean away from expensive top-heavy management and toward more middle-level managers who serve our customers directly,” said Diethrich. He plans to use the salaries he is saving on top managers for the new middle managers.

Diethrich was hired as senior credit officer at Orange City in September, 1984, after serving six months as president of a small bank in San Dimas in Los Angeles County. Before that, he was senior vice president of the Bank of Newport in Newport Beach.

List, who began investing in Colorado real estate several years ago and who also is financing a hotel in Huntington Beach, paid more than $1.6 million for 84% of Orange City’s stock at the end of last year, capping four months of negotiations. After assuming control, he added an additional $1 million to the bank’s capital.

The 9-year-old bank, with assets of $58 million last year, has been operating under an order from the Federal Deposit Insurance Corp. to raise additional capital to offset loan losses. The bank posted a net profit of $390,000 in 1983 but was caught with bad real estate loans and overappraisals that contributed to a $721,000 loss in 1984.

‘Significant Loss’

Diethrich previously had said that there would be a “significant loss” for 1985 as well, but a financial report for the year has not yet been released. He said in an interview shortly after he was named president and chief executive last December that the bank had posted operational earnings of $11,000 in November.

Diethrich, a decade-long friend of List, replaced former president David T. Blankenhorn, who remains as a director.

Mark E. Simmons, the executive vice president, left late last month to take a similar position at Marine National Bank, and Fred Buchanan resigned early last month as manager of the bank’s Orange office.

Diethrich replaced Buchanan with Fred Grohmann of Westminster. Grohmann has 15 years of banking experience in Orange County and was vice president and manager of the Anaheim and Placentia offices of Valencia Bank, which regulators declared insolvent and closed last month.

“Simmons’ departure left somewhat of a hole, but we have a senior cashier, Sandra Harvey, who could plug part of that hole,” Diethrich said. “But now we have only two on the top management team--me and the cashier.”

New Vice Presidents

He said he expects to hire a senior credit officer within a few months to fill his old post and join the senior managers.

Additionally, Diethrich has hired Peter W. Bartling and Ronald G. Bender as vice presidents in the professional lending group in the bank’s Newport Beach office, and he has hired George D. Robertson as vice president for real estate in the same office.

The bank also has a Huntington Beach office.

Bartling, of Corona del Mar, has 15 years’ banking experience. He comes from San Gabriel Valley Bank in El Monte. Bender, of Huntington Beach, has 14 years’ experience in Colorado and California. He comes from Great American Bank’s Newport Beach office. Robertson, of Newport Beach, has 20 years’ experience in the savings and loan and the real estate industry, specializing in acquisitions and development credit. He had operated his own loan brokerage firm.

Meantime, List has until Thursday to mail a tender offer to remaining shareholders. Under List’s agreement with the previous owners, Diethrich said, a provision requires that he offer to purchase the remaining 16% of Orange City’s common stock at the same price--$10.61 a share--he paid to obtain controlling interest.