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California Federal Bank Unit Acquires Gulf States Acceptance Company

5 February 1998

California Federal Bank Unit Acquires Gulf States Acceptance Company

    DALLAS, Feb. 4 -- California Federal Bank's Auto One
Acceptence Corporation has purchased Gulf States Acceptance Company, a
Houston-based automobile finance company, from Gulf States Financial Services,
Inc.  The transaction closed today.
    Gulf States operations and employees will be merged into Auto One, which
operates as a subsidiary of Cal Fed and is headquartered in Dallas.  Gulf
States' current Houston location will remain as a significant credit
underwriting office of Auto One.
    Cal Fed acquired Dallas-based Auto One Acceptance Corporation in September
1997.
    "We entered the sub-prime financing arena with our Auto One purchase,"
said Carl Webb, president of California Federal Bank.  "We continue to be
pleased with that acquisition, so we have decided to build on that business.
The Gulf States acquisition makes sense for both Cal Fed and Auto One as it
gives us a larger auto loan distribution network, increases our portfolio
size, and provides additional production and underwriting resources.  This
will help us achieve a more substantial standing in the sub-prime auto finance
industry."
    The addition of Gulf States' managed portfolio of $300 million more than
doubles Auto One's managed portfolio to $520 million.
    Gulf States has been in business since 1993, with the majority of its
business coming from Texas, Louisiana and Georgia.  Auto One is a licensed
lender in 47 states.  The combined company will provide loan processing
funding and loan servicing for more than 1,200 franchised automobile dealers.
    San Francisco-based California Federal Bank, one of the five largest
savings and loans in the country, operates 225 retail branches in three
states:  California, Florida and Nevada.  Its mortgage subsidiary, First
Nationwide Mortgage Corporation originates and services mortgage loans
nationwide.  Cal Fed employs approximately 5,300 people and has total assets
of approximately $31 billion.

SOURCE  California Federal Bank