After swallowing two of Southern California’s biggest thrifts, Washington Mutual Inc. is setting its sights on becoming a West Coast powerhouse capable of taking on BankAmerica Corp. and Wells Fargo & Co. in the consumer banking arena.

“In our target markets our primary competitors will be Bank of America and Wells Fargo,” CEO Kerry Killinger said in an interview with the Business Journal last week. “We see great opportunities to take market share from them within our niche, which is focused on personalized service, and appealing to customers that want that level of service.”

Washington Mutual’s acquisition of Chatsworth-based Great Western Financial Corp., along with its previous acquisition of Irvine-based American Savings Bank, has turned it into the nation’s largest thrift, a behemoth with $88.5 billion in assets.

The merged institutions will be known by the Great Western name in California.

Killinger was in Los Angeles last week to meet with Great Western and American Savings employees, and to begin to “draw together one common vision.”

“The No. 1 priority for us over the next several months is to be sure we’re bringing together one unified culture in our combined company,” said Killinger.

Since acquiring American Savings last Dec. 21 for $1.7 billion, Washington Mutual has gone on an aggressive marketing campaign that yielded 31,000 new checking accounts in the first quarter of 1997, compared with a decline in the number of checking accounts for the like-period a year before, said Killinger.

And in its most dramatic move yet, Washington Mutual beat out H.F. Ahmanson & Co. this spring to acquire Great Western at a cost of more than $7 billion. The acquisition took effect July 1.

Killinger, who keeps an oversized Energizer Bunny in his Seattle office, said one of Washington Mutual’s first priorities will be to debut a wide array of new consumer banking products at the Chatsworth-based operation.

New products coming soon to Great Western branches include more checking and money market accounts, consumer loans, mutual funds and annuities, Killinger said. Washington Mutual will also introduce mortgage lending into all Great Western branches over time. Great Western currently only offers mortgages at some of its branches.

Other bankers acknowledge that Washington Mutual will be a strong competitor. But officials at BofA and Wells Fargo said Southern California’s fiercely competitive banking market cuts both ways, and that Washington Mutual will face its own set of challenges in trying to increase its market share here.

Many details about Great Western’s future remain unclear.

Killinger said the extent of layoffs, for one thing, have yet to be determined. However, a major presence will be retained in Irvine, Chatsworth and Stockton, he said.

“There will be a very significant administrative operation here (in Chatsworth), and it’s just a matter of figuring out which work groups will work the best,” he said. “Of all the areas that we have to operate in, the one where we’re tightest on space is Seattle. It’s unlikely we’ll be doing any major movement or consolidation of activities up in Seattle. I expect, at least in terms of the number of people, the greatest growth will be in either Stockton, Chatsworth or Irvine.”

Killinger said he would like to buy a residence in Southern California, since he anticipates spending a considerable amount of time here in the years ahead.

Analysts and investors alike seem confident of Killinger’s ability to deliver on his aggressive growth targets. The company’s stock has jumped more than 800 percent during Killinger’s seven years as CEO, and nearly 10 percent in the month since Great Western and Washington Mutual shareholders approved the merger.

In fact, Killinger’s stated goal of growing earnings per share by at least 15 percent annually should not be difficult if Washington Mutual keeps expanding at its present rate, said Todd Pitsinger, an analyst at Friedman Billings Ramsey & Co.

“He can grow earnings per share at 15 percent over the next two to three years, but it could become more difficult as he approaches $150 billion in assets,” Pitsinger said.

The big question among bankers and analysts is what Killinger’s next acquisition target will be and when he will make his next move.

Killinger said he plans to focus his energies on integrating Great Western for the next few months and is not in the market for acquisitions, although Pitsinger noted that Washington Mutual has the resources to acquire a smaller thrift at any time.

Washington Mutual would also like to establish a commercial banking presence in California, using its commercial banking franchise, Western Bank of Seattle.

Killinger said he would prefer to pursue friendly mergers in the future, though he could not rule out hostile bids such as the one that Ahmanson, which owns Home Savings of America, made for Great Western.

“We’ve never been hostile. But as a matter of principal, I won’t close the door on any alternative from a sound business standpoint,” he said. “But I can tell you, to date, we have never seriously considered a hostile situation in any transaction, and we’ve done 22 deals in the last decade.”

On high-profile but less-significant matters, Great Western’s corporate jet will likely be grounded, but the Great Western Forum may live on.

“I would not expect the jet to remain with the company,” said Killinger, who is known for his low-key style. “In terms of the Forum everything I’ve heard is, we anticipate a continuation of the sponsorship there as far as I know.”

And what fate awaits Great Western’s cowboy image?

“We’ll take a good hard look at what the right positioning over time should be. There’s a primary positioning for the company it will be one of positioning ourselves as an alternative to the major commercial banks,” Killinger said.