2nd-biggest stock offering due -- by savings institution

When the Ford Motor Company ''went public'' in 1956, its stock sale of more than $600 million ranked as the largest initial stock offering for an American company. It still does, but in what may be a sign of the times, the new No. 2 is not a manufacturing company, or even a high-tech firm, but a savings bank.

With its first sale of stock to the general public later this month, the Philadelphia Savings Fund Society (PSFS) is completing a conversion from a depositor-owned mutual savings institution to a shareholder-owned stock savings bank. The sale is expected to bring in around $500 million. It will make PSFS part of a growing trend in savings banking of converting to stock ownership.

In March, two California institutions, Home Federal Savings & Loan and California Federal Savings & Loan, the third- and ninth-largest S&Ls in the country, respectively, made their first public stock offerings.

Industry sources say there have been more than 30 savings bank or S&L conversions so far this year.

Going public, says PSFS chairman M. Todd Cooke, gives the bank the resources it needs to do the one thing it must do to survive in the highly competitive banking and savings business today: grow.

''Given our considerable size and dominant position in the marketplace, we have very little option but to expand,'' said the chairman of what had been the largest mutual savings bank in the United States.

PSFS has already been on the acquisition trail. Last year it took over the failing Western Savings Bank of Philadelphia. Selling some of that bank's commercial mortgages in June helped PSFS show a profit for the second quarter, something it has had trouble doing in recent years. Like many other savings institutions, PSFS was hit hard by rising interest rates and the flow of deposits to higher-yielding accounts. The last year it showed a profit was 1980.

Going public should help continue the profitable trend, Mr. Cooke says, because the bank will be able to invest the proceeds in other, more lucrative ventures.

The decision to make the stock offering was made several months ago, he noted , when interest rates were heading down. In theory, that is the time when thrift stocks are more attractive, since the cost of money for a bank is dropping. But lately, interest rates have been inching back up.

''Bank stocks have been under a little bit of pressure because of higher interest rates,'' Cooke acknowledged. ''But I don't think it will significantly affect this offering.'' The stock has not yet officially gone on the market, but he expects it will fetch $15 to $20 a share.

Even though PSFS has plans to continue growing, its chairman thinks there will still be a place for the small, local savings bank - for now, at least.

''I think it depends a lot on their situation,'' Cooke said. ''Some small savings banks in less competitive environments that have served their local customers well should be able to continue operating as traditional savings banks , for a while.''

Does this mean the larger thrifts will eventually expand into these smaller institutions' territories and swallow them up?

''I don't know,'' he said. ''I wonder whether they [the smaller banks] can continue to function as they have in the past.''

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