Southland's largest thrifts continue cutting assets.

Decline of 5.3% surpasses national industry average

Assets of the top 25 Los Angeles County-based savings and loans plummeted by 5.3 percent over the last year, according to this week's List.

"Well, 5.3 percent is a fairly sizable decline," said Ken Ackbarali, senior economist at First Interstate Bancorp. "Given the really negative condition of the Southern California economy, the figure is not that surprising."

Thrift assets were $152.1 billion at the end of June 30, 1991 compared to $160.5 billion at the end of June 30, 1992, according to the List. Asset size declined at eight of the top 10 thrifts, according to the List.

At both No. 1-ranked Home Savings of America and No. 2-ranked Great Western Financial Corp., which is the largest S&Ls in the country, assets shrank by more than 2 percent.

At No. 3-ranked Glendale Federal Bank, No. 4-ranked CalFed Inc. and No. 5-ranked Coast Federal Bank, all institutions which are thinly capitalized, assets went down by 16 percent, 11.4 percent and 5.6 percent, respectively.

Los Angeles County-based thrifts experienced a decline in assets which was greater than the national average. Nationwide, assets at savings and loans declined by 4.2 percent, according to figures provided by the Office of Thrift Supervision and the Resolution Trust Corp.

Assets declined by $1.1 billion, a drop of 2.8 percent, at giant S&L Great Western Financial Corp., mainly because of the popularity of fixed-rate mortgages, said Kevin Hawkins, spokesman for the Chatsworth-based thrift.

"We almost exclusively hold adjustable rate mortgages," he said. The S&L sells fixed-rate mortgages it originates to the secondary mortgage market, he said.

Meanwhile, at CalFed Inc., the shrinkage of assets is part of a plan to meet capital requirements placed on the thrift by the OTS, said Frank Moore, assistant vice president for the Los Angeles-based institution. CalFed also sold loans to the secondary market and reduced assets to $17.8 billion as of June 30 from $19.5 billion a year earlier.

The thrift is operating under orders of federal regulators to raise capital ratios by June 1993. Reducing asset size will help to enable CalFed to meet those goals, Moore explained.

Ultimately, CalFed officials want to shrink assets to between $16.5 billion and $17.5 billion, Moore said. "We're maintaining an asset size which will generate earnings once the California real estate market turns around," he said.

Woodland Hills-based Republic Federal Savings & Loan Association, which ranked No. 14 on the last year's List, voluntarily dissolved in March.

Century City-based Topa Savings Bank, which ranked No. 16 on the last List, is not on the latest one because the thrift's officials declined to participate.

Newcomers to The List include Arcadia-based Trust Savings Bank at No. 24 with $121 million in assets and Vista Bank, which is headquartered in the City of Industry, at No. 25 with $104 million in assets.