BIDDER PLANS SOCIAL ACTION : AHMANSON VOW MAY AID TAKEOVER.

Byline: Gregory J. Wilcox Daily News Staff Writer

H.F. Ahmanson & Co. moved to seize the social high ground Thursday in its battle for Great Western Financial Corp. by pledging $70 billion in affordable housing and community development loans if its hostile takeover succeeds.

Charles R. Rinehart, chairman and chief executive officer of the Irwindale-based company, said that the financial commitment - to be spread over 10 years - is 50 percent greater than what has ever been proposed by any depository institution.

The package includes $45 billion in home mortgages for minorities and low-income families, $12 billion in consumer loan products for minorities and the underprivileged, small-business financing, and charitable donations.

Ahmanson, parent of Home Savings of America, also promised to take ``aggressive steps'' to increase ethnic diversity at the company all the way up to the board of directors.

If the deal for Great Western falls through, Ahmanson will go forward with a scaled-down version of the community reinvestment plan that is commensurate with its asset base.

Ahmanson's offer comes less than a month after Great Western's board of directors accepted a friendly merger offer from Seattle-based Washington Mutual Inc. But Great Western's stockholders have to approve any deal before it can go through.

``We are making this commitment because it is good business. We see this as an opportunity, not an obligation,'' Rinehart said of the plan.

He also denied that his company was making the announcement now to avoid a confrontation during the regulatory approval process.

Great Western had no comment.

Washington Mutual spokesman Bill Ehrlich said that his company will probably make public its community reinvestment plan in the next several weeks.

``We're in the process right now of meeting with a number of community groups, not only in California but throughout our service territory to develop a long-term commitment,'' he said. ``Serving the community is something you need to be concerned with regardless of whether you are in the middle of a merger.''

Ahmanson's reinvestment plan was developed after more than a year of negotiations with the Greenlining Institute, a coalition of 33 community organizations that now supports Ahmanson's bid over Washington Mutual's.

The San Francisco-based group has been active in mergers for about 20 years and opposes deals that don't benefit low-income or minority communities or people with disabilities.

He called the move ``a major step toward revolutionizing and revitalizing the economic and social development of inner city and minority communities that have long been under-served.''

Lending pledges like this have been used by financial companies to make their takeover bids more attractive. During the industry's last major takeover fight, Wells Fargo & Co. pledged $45 billion in similar loans if it bought First Interstate Bancorp. Wells closed the deal less than four months later.

Analyst Thomas O'Donnell at Smith Barney in New York said the offer is a smart move on Ahmanson's part.

``I think the social issues will have a play in the decision on who gets Great Western,'' he said. ``This is the way of the world. As a lender you can do well by doing good.''

On Monday, Ahmanson upped its offer for Great Western to more than $6.62 billion.

Ahmanson's stock closed Thursday at 39 -1/2, down -1/8; Washington Mutual's stock was unchanged at 50 -7/8 and Great Western's closed at 44 -1/4, down -1/8.