LOS ANGELES (AP) _ An investor group headed by former U.S. Treasury Secretary William Simon has agreed to take over Southern California Savings & Loan Association, declared insolvent by regulators two years ago.

The move, announced Thursday, is the latest effort by Simon and former Federal Reserve Board vice chairman Preston Martin to build a major presence in the lending industry in the Pacific Rim by buying up troubled thrifts.

Martin was named chairman and chief executive of SoCal Holdings Inc., which was established to acquire SoCal Savings. He and Simon are principal owners of the holding company.

Besides Simon and Martin, the investor group includes Gerald Parsky, managing partner of the prestigious law firm Gibson Dunn and Crutcher, who served as assistant treasury secretary under Simon; Roy Doumani, chairman of the World Trade Bank; Craig Gosden, a real estate attorney and former White House staffer; and Larry Thrall, a real estate attorney.

Timothy Childs, who was chief executive of SoCal Savings before it was acquired by City Investing Co. and ran into financial trouble, will return in the same post.

SoCal Savings, with assets of about $1.3 billion, was taken over by the Federal Home Loan Bank Board in June 1985. Since then it has been run by Great American First Savings under the bank board's management-consi gnment program.

To expedite the takeover, the Federal Savings & Loan Insurance Corp. agreed to pump $217.5 million in cash into the thrift, as well as to indemnify investors against undisclosed liabilities, claims for which reserves haven't been established and legal challenges to the deal.

The FSLIC said that approach would cost about $20.5 million less than liquidating the thrift.

Outside investors, including the Simon group, will put $40 million in capital into SoCal Savings.

In a unique twist, the FSLIC required that the new owners adhere strictly to regulatory requirements or lose control of the thrift.

Under the agreement, the FSLIC has the right for 12 years to take back the thrift and sell it to other investors, if its new owners allow its net worth to drop below the required 3 percent level.

Lawrence Hayes, deputy general counsel for the Federal Home Loan Bank Board in Washington, said the arrangement aims to guarantee that the new owners will run the thrift properly.

Simon and Preston are involved in groups that in the past year have acquired Honolulu Federal Savings and have applied to regulators to acquire Bell Savings & Loan in San Mateo, Calif.

Martin said the group is negotiating to acquire a number of other healthy thrifts as well.