World Savings Co-Founder Dies

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MORTGAGE EXPERT
6 · 03 · 12

The co-founder of World Savings Bank has died. The philanthropist was considered a pioneer by some, while others considered her to be among those responsible the demise of Wachovia Corp.

World-parent Golden West Financial Corp. was acquired in 1963 by Herb and Marion O. Sandler. The couple contributed $1.3 billion of their personal earnings to the Sandler Foundation — which says that its mission is to “be a catalyst to strengthen the progressive infrastructure, expose corruption and abuse, advocate for vulnerable and exploited people and environments, and advance scientific research in neglected areas.”

On Friday, Marion Sandler passed away at the age of 81.

Sandler graduated from Wellesley College and was the first woman executive ever hired by the investment banking firm of Dominick Inc., according to her biography. She followed that job up as a senior analyst for the savings and loan industry at Oppenheimer and Company.

After marrying Herb Sandler in 1961, the couple believed they could do a better job at running a savings and loan than others and acquired Golden West.

At Golden West, she was one of the first women chief executive officers of a Fortune 500 company

Among executives who worked at the Oakland, Calif.-based financial institution was Mortgage Bankers Association chief executive officer David H. Stevens — who spent 16 years there. Stevens, who subsequently served in the Obama administration as Federal Housing Commissioner, is leaving MBA next month to begin an assignment as president of SunTrust Mortgage.

Sandler’s obituary highlights the extreme success of Golden West.

“Golden West was a risk-averse residential mortgage portfolio lender with a long-standing reputation for ethics and integrity, quality lending, the lowest loan losses in the industry, high tangible net worth, and low expenses,” the obituary states.

But the company turned out to be a can of worms for Wachovia — which acquired the unit in 2006.

Saddled with payment-option, negative-amortization, adjustable-rate mortgages originated by Golden West in many of what would become the worst real estate markets, Wachovia barely avoided failure with its 2008 acquisition by Wells Fargo & Co.

The Sandlers reaped an estimated $2.4 billion from the sale of Golden West and were left unscathed by the worst financial crisis since the Great Depression.

They took some of their money and founded ProPublica, “an independent, non-profit newsroom that produces investigative journalism in the public interest,” according to the publication. ProPublica has published several stories critical of U.S. mortgage lenders, including Wells Fargo & Co. — the very company that now is cleaning up the mess from option ARMs originated by Golden West.

“Marion participated actively in every ProPublica board meeting until the most recent one; only her last illness could keep her away,” the publication said in a statement. “Usually in such sessions, she was knitting except when speaking; always, she was listening carefully, and her points were as tightly focused as her stitches.”

But ProPublica was careful to note that Sandler “never saw a story before it was published, never asked to, never tried to interfere in news or editorial matters in any way.”

The American Civil Liberties Union issued a statement calling Sandler “our dear friend and colleague” and praising her as “a bold visionary who was passionately committed to preserving and strengthening civil liberties for all.”

“She blasted through every gender barrier in the investment and banking world at a time when women were still being asked to fetch their male co-workers their morning coffee,” the ACLU statement said.

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