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FIRSTFED ANNOUNCES FIRST QUARTER EARNINGS FOR 1992

 FIRSTFED ANNOUNCES FIRST QUARTER EARNINGS FOR 1992
 SANTA MONICA, Calif., April 21 /PRNewswire/ -- FirstFed Financial


Corp., holding company for First Federal Bank of California, today announced net earnings of $6.8 million or $0.62 per share of common stock for the first quarter of 1992. These results represent a 13 percent decrease from $7.8 million or $0.71 per share of common stock for the first quarter of 1991 and a 61 percent increase from $4.2 million or $0.39 per share for the fourth quarter of 1991. All per share comparisons are based on shares outstanding after adjustment for the five-for-four stock split declared Sept. 26, 1991, and distributed Oct. 31, 1991.
 The decrease in earnings compared to the prior year was the result of substantial additions to loan loss reserves during the first quarter. William S. Mortensen, chairman and chief executive officer of FirstFed, noted, "The $10.7 million in additional loan loss reserves is due largely to amounts required by the Office of Thrift Supervision as a result of its recently completed examination." He continued, "Although management felt that its reserves prior to examination were adequate, the increased reserves bring the bank an additional measure of protection from further declines in the economy." He continued, "Charge offs (net of recoveries) were only $1.7 million during the first quarter. General loan loss reserves as a percentage of loans with loss exposure stood at 0.57 percent at the end of the first quarter, compared to 0.41 percent at the end of the fourth quarter of 1991."
 Real estate operations resulted in a net gain of $336,000 during the first quarter. Gains recorded on the sale of foreclosed properties were primarily the result of very conservative reserves placed on the properties by management.
 The bank recorded a $3.0 million tax benefit during the first quarter as a result of implementing Statement of Financial Accounting Standards No. 109 ("SFAS No. 109"). SFAS 109 also clarified the appropriateness of the "two-difference" method of determining taxable income after consideration for bad debts. In using this "two- difference" method, the bank may now take a tax benefit for additions to its book loss reserve.
 First quarter results also included a $1.7 million charge for interest expense on possible tax adjustments by the Internal Revenue Service (IRS). The bank has been undergoing an audit by the IRS for the past three years. The IRS is attempting to accelerate income recognition on certain taxable items which could result in additional interest expense to the bank. Any taxes due had already been accrued. This charge brings the bank's provision for IRS interest up to date based on a current analysis of the likelihood that the IRS may prevail. An ongoing charge of approximately $100,000 per month will be booked in 1992 to keep the interest accrual current.
 The interest rate spread before considering the IRS adjustment increased to 3.28 percent during the first quarter from 3.09 percent for the fourth quarter of 1991. The increase was primarily the result of the continuing decline in the bank's cost of funds. Because of the IRS interest adjustment, the interest rate spread for the first quarter was lowered to 3.00 percent.
 In line with previously announced expansion plans, the bank acquired seven retail savings branches from the Resolution Trust Corp. during March, adding 35 new employees and bringing the total number of retail savings branches to 25. The funds acquired were used to reduce brokered deposits and other debt.
 Reflecting general economic conditions, non-performing assets increased during the first quarter to $76.6 million or 2.30 percent of total assets at March 31, 1992, from $64.8 million or 1.97 percent of total assets at Dec. 31, 1991. Non-performing assets increased in response to delinquency and foreclosure problems in both single family and multifamily loans.
 Loan originations improved during the first quarter of 1992 and reached $183.9 million, which amounted to a 54 percent increase from $119.5 million for the same period last year and a 20 percent increase from $153.4 million for the fourth quarter of 1991. Approximately 56 percent of loans originated were refinance loans. Adjustable rate mortgages comprised 73 percent of loans originated.
 In anticipation of stronger loan originations in 1992, the bank increased the number of loan consultants by more than 30 percent during the first quarter. Loan consultants are paid on a commissioned basis and their expenses are tied directly to the level of loan originations. In addition, the bank intends to open two new regional loan centers in 1992, one in northern Orange County and another in Ventura County.
 The bank substantially exceeds all fully phased-in regulatory capital requirements at March 31, 1992. The most stringent requirement, the risk-based capital ratio, reached 9.60 percent at March 31, 1992. The tangible capital and core capital ratios stood at 5.70 percent and 5.83 percent, respectively, at March 31, 1992.
 Mortensen stated that the bank's management is focusing on producing long-term, sustained earnings for stockholders. He commented, "Both positive and negative unusual adjustments were recorded during the first quarter of 1992. We believe that these first quarter lion. "Our 1992 earnings target remains in excess of $30 million assuming we experience a reasonable economic recovery during the year," he added.
 FIRSTFED FINANCIAL CORP. AND SUBSIDIARY
 Consolidated Statements of Financial Condition
 (In Thousands)
 March 31, Dec. 31,
 1992 1991
 (unaudited)
 Assets
 Cash and cash
 equivalents $154,241 $156,575
 U.S. government and
 other securities,
 at cost (market of
 $16,691 and $16,991) 16,166 16,172
 Loans receivable 2,378,963 2,322,232
 Mortgage-backed
 securities (market
 of $543,151 and
 $540,958) 537,803 519,499
 Loans and mortgage-backed
 securities held for
 sale (market of
 $127,411 and $159,445) 126,266 154,115
 Accrued interest and
 dividends receivable 26,333 28,798
 Real estate 21,747 25,786
 Office properties and
 equipment, net 8,531 8,748
 Investment in Federal
 Home Loan Bank stock,
 at cost 28,692 28,220
 Other assets 28,588 26,914
 Total $3,327,330 $3,287,059
 Liabilities
 Deposits $1,938,914 $1,740,103
 Federal Home Loan Bank
 advances and other
 borrowings 1,114,529 1,280,372
 Income taxes payable 28,968 31,039
 Accrued expenses and
 other liabilities 48,287 45,369
 Total 3,130,698 3,096,883
 Contingent liabilities
 Stockholders' equity
 Common stock, par value
 $.01 per share; authorized
 25,000,000 shares; issued
 10,940,391 and 10,921,891
 shares, outstanding 10,423,771
 and 10,405,271 shares 109 109
 Additional capital 23,805 23,674
 Retained earnings --
 substantially restricted 180,368 173,594
 Loan to employee stock
 ownership plan (2,414) (1,965)
 Treasury stock, at cost,
 516,620 shares (5,236) (5,236)
 Total 196,632 190,176
 Total $3,327,330 $3,287,059
 FIRSTFED FINANCIAL CORP. AND SUBSIDIARY
 Consolidated Statements of Operations
 (Unaudited)
 (In Thousands)
 Three Months Ended
 March 31,
 1992 1991
 Interest income:
 Interest on loans and
 mortgage-backed securities $66,067 $73,327
 Interest and dividends on
 investments 1,917 2,314
 Total interest income 67,984 75,641
 Interest expense:
 Interest on deposits 23,467 31,899
 Interest on borrowings 18,320 20,719
 Total interest expense 41,787 52,618
 Net interest income 26,197 23,023
 Provision for loan losses 10,716 1,203
 Net interest income after
 provision for loan losses 15,481 21,820
 Other income (expense):
 Loan and other fees 1,692 1,470
 Gain on sale of loans 379 421
 Real estate operations, net 336 (65)
 Other operating income 466 305
 Total other income 2,873 2,131
 Non-interest expense 11,052 10,454
 Earnings before income taxes 7,302 13,497
 Income tax provision 528 5,735
 Net earnings $6,774 $7,762
 Earnings per share (E.P.S)(a):
 Primary $0.62 $0.72
 Fully diluted $0.62 $0.71
 Weighted average shares for
 E.P.S calculation(a):
 Primary 10,932,558 10,811,654
 Fully diluted 10,932,590 10,874,830
 Key Financial Results Are Highlighted Below
 Three Months Ended
 March 31,
 1992 1991
 Net earnings $6,774,000 $7,762,000
 Earnings per share(a):
 Primary $0.62 $0.72
 Fully diluted $0.62 $0.71
 Book value per share(a) $18.86 $16.46
 Weighted average shares
 outstanding(a):
 Primary 10,932,558 10,811,654
 Fully diluted 10,932,590 10,874,830
 Assets $3,327,330,000 $3,049,211,000
 Loans $3,043,032,000 $2,794,576,000
 Deposits $1,938,914,000 $1,725,636,000
 Borrowings $1,114,529,000 $1,065,357,000
 Stockholders' equity $196,632,000 $169,273,000
 Loan originations $183,853,000 $119,516,000
 Net interest income $26,197,000 $23,023,000
 Non-performing assets to
 total assets 2.30 pct. 1.39 pct.
 Net worth to assets ratio 5.91 pct. 5.55 pct.
 Tangible capital ratio 5.70 pct. 5.48 pct.
 Core capital ratio 5.83 pct. 5.48 pct.
 Risk-based capital ratio 9.60 pct. 9.06 pct.
 Interest rate spread during
 the period 3.00 pct. 2.73 pct.
 Pct. adjustable mortgages 95.71 pct. 95.00 pct.
 Expense ratios:
 Pct. gross income 15.60 pct. 13.44 pct.
 Pct. average assets 1.34 pct. 1.37 pct.
 One year "gap" pct.
 of assets 9.16 pct. 6.66 pct.
 Return on assets 0.82 pct. 1.02 pct.
 Return on Equity 14.01 pct. 18.78 pct.
 (a) All per share figures have been adjusted for the five-for-four stock split declared Sept. 26, 1991.
 -0- 4/21/92
 /CONTACT: Martin Gottlieb, executive VP of FirstFed Financial, 213-319-6000/ CO: FirstFed Financial Corp. ST: California IN: FIN SU: ERN


DM-EH -- LA016 -- 0405 04/21/92 09:06 EDT
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