REBECCA KUZINS

Staff Reporter

Back in the ’80s, when Los Angeles was expected to become the hub of the Pacific Rim, many people predicted that it also would serve as headquarters of some of the world’s largest banks.

These days, however, you’re as likely to find major banking activity at a check processing center in El Monte or a loan servicing operation in Chatsworth as in the glittering office towers of downtown Los Angeles or Beverly Hills.

With its three largest banks now headquartered elsewhere, L.A. has been relegated to a place where checks are encoded, ATM deposits recorded, bank statements prepared and mailed, and any number of other clerical functions performed.

Bank of America, Wells Fargo and Washington Mutual employ almost 7,700 employees at their various back-office facilities, also known in industry parlance as “check shops.”

In the past, when Wells Fargo and Bank of America were both headquartered in San Francisco, they set up back-office operations in L.A. because it was the most populous area in Southern California and the source of many corporate accounts.

Since 1986, Wells Fargo has performed many clerical functions at a center in El Monte. It also operates a cash vault in downtown Los Angeles, near the Federal Reserve Bank.

Bank of America also maintains a downtown cash vault at 11th and Figueroa streets, and since 1978 has done many other check shop tasks at its Los Angeles Data Center at Temple and Beaudry streets.

But things have changed in the past few years. Wells Fargo and Bank of America have merged with giant out-of-state banks, and Seattle-based Washington Mutual entered the local market by acquiring H.F. Ahmanson, the parent of Home Savings of America. The merger mania has forced the three banks to consolidate and relocate local back-office operations.

For example, after Bank of America bought Security Pacific in 1992, BofA closed Security Pacific’s three Southern California check shops and moved the operations to BofA’s downtown data center.

“This allowed us to spread the costs of our fixed assets and equipment over large volumes,” said Chuck Wolski, executive vice president and manager for BofA’s western region operations. “It was easier to control the quality in one site than in four sites.”

Following the Northridge earthquake in 1994, Wells Fargo moved its data processing operations out of El Monte and housed its central computer system in a more temblor-proof facility in Roseville, near Sacramento. Much of the Roseville operation was later moved to Tempe, Ariz., site of First Interstate’s central computer system, after Wells merged with First Interstate in 1996.

Meanwhile, Washington Mutual took over Great Western Savings’ administrative center in Chatsworth when it acquired Great Western in 1997. WaMu now employs 2,850 people at the center to staff its customer call center, process loan applications, handle monthly collections and foreclosures, and perform other tasks.

Spokesman Tim McGarry said WaMu decided to house these back-office operations in Chatsworth simply because it was convenient. “Great Western already had many functions there, so what would be the point of moving somewhere else?” he said.

McGarry said the number of employees at the Chatsworth site will grow to about 4,500 over the next two years as Washington Mutual further consolidates back-office operations with Home Savings and Loan.

Processing transactions for millions of customers keeps the check shops operating around the clock.

At BofA’s Temple and Beaudry facility, 2,800 employees perform a number of support services for the bank’s Southern California branches, an area that stretches from Fresno south to the California border. Wolski said 60 percent of the bank’s California check volume is handled there, with the remaining 40 percent processed in San Francisco.

Employees at the L.A. facility prepare and mail 5 million to 8 million customer statements and process as many as 200 million checks and deposits each month.

Bank of America employs another 600 people at its downtown cash vault, where the Federal Reserve deposits money that is later distributed through BofA branches and ATMs. Employees also process checks deposited through ATMs, and post ATM deposits and withdrawals to customers’ accounts.

Wells Fargo employs 120 people at its downtown cash vault, and another 1,300 staffers at its El Monte check shop and customer call-in center.

Ray Pearl, Wells Fargo production support manager for California, said back-office employees consider themselves the heart of bank operations.

“I have a son who did a lot with theater in high school and college,” says Pearl. “You see the stars of the show but you never see the stage crew. We (back-office workers) are like the stage crew. We’re not seen, but you can’t put on the play without us.”