FIRSTBANK CHIEF SMOOTHS MERGER

June 04, 2003 12:00 am

By Mike Ferguson

For The Observer

BAKER CITY — When he comes to town, Clyde Conklin is sensitive to his choice of coffee mug.

During a recent early morning interview, the president and chief executive officer of FirstBank Northwest sips from a gleaming cobalt Pioneer Bank mug.

FirstBank, based in Lewiston, may be figuratively swallowing up Baker City-based Pioneer Bank, but Conklin isn't about to swallow his coffee out of a FirstBank mug. Not in Pioneer's hometown, at least.

In February, the banks announced that they plan to merge by fall. That agreement must be ratified by both companies' shareholders and by the Securities and Exchange Commission, the Office of Thrift Supervision and the Federal Deposit Insurance Corp.

Both Conklin and Pioneer's Zane Lockwood, the bank's executive vice president, said they see no barriers to the planned merger.

Conklin, a 1969 graduate of Baker High School, was in the area for two days, visiting Pioneer's nine branches and meeting with business leaders.

One reason for his visit, he said, was to begin to evaluate the strength of Pioneer's systems and services and decide which ones to build upon as Pioneer slowly gives way to FirstBank after the merger closes.

Conklin said that after the merger, FirstBank will maintain Pioneer's corporate headquarters at 2055 First St. It may be that some of FirstBank's mid-level managers are housed in Baker City, he said.

The downtown Baker City building houses two services that Conklin prizes for his growing bank — the imaging system and Pioneer's branch support center.

Pioneer was one of the first banks in the region to invest in a computer system that can produce images of canceled checks and deposits instantly for its customers, Lockwood said. That's the kind of technology that Conklin wants FirstBank to build on.

Pioneer's branch support center performs much of the bank's back office work, including researching records requests for customers.

That approach "maximizes the time that customer service representatives can spend with their customers," Conklin said. "Pioneer does it in a manner that the customer still feels close to his branch."

The planned merger will cost Oregon Trail Financial Corp., Pioneer's holding company, at least three jobs: those of president and chief executive officer Berniel Maughan, Lockwood, and Jonathan McCreary, the chief financial officer.

It may be, Conklin said, that more positions are eliminated in the merger, but those cuts have not yet been announced.

Pioneer Bank's customers and Baker County residents will notice few other changes, Conklin said.

"It's not just lip service to say that the impact on our customers will be minimized," he said. "This is truly an opportunity to take OTFC's systems and build upon them.

"This is not some Wells Fargo-type merger where they put in their manuals, their system, and leave you with an 800-number for solutions. These are two companies that have an opportunity to build something special.

"And our investors see that. They've told me that of all the mergers they've seen, this one makes sense to them."

The two banks have in common their philosophies and corporate cultures, both Lockwood and Conklin said. Both went public in 1997, when both saw agricultural and commercial lending as their niche markets. Maughan and Conklin have known each other for years, and there is that Baker High School connection for Conklin.

"You don't think a Baker High School graduate is going to let OTFC's corporate office sit vacant or be sold to a rival bank, do you?" he asks with a smile.

Baker City customers will get the chance soon to sample Conklin's barbecue abilities. He plans to attend Pioneer's annual barbecue July 3 in the bank parking lot, where he will don an apron and flip his share of burgers.

FirstBank will continue to underwrite many of the charitable events Pioneer has been involved in, including St. Elizabeth Hospital's Festival of Trees. Lockwood says he plans to complete his current term as the Festival's co-chair.

Both companies' stocks have soared since the merger was announced in late February. FirstBank Northwest is up about 9.4 percent, to $25.54 per share, since March 3.

OTFC is up about 4.7 percent, to $23.70 per share, over the same time frame. FirstBank's stock symbol is FBNW.