State and federal regulators seized Equitable Savings & Loan Assn. late Friday, declared the Fountain Valley-based institution insolvent and began efforts to liquidate its $59.1 million in assets.
The insured savings accounts were immediately transferred to Empire of America, a federal savings bank, and all five Equitable branch offices in Orange, Irvine, Fountain Valley, Bellflower and San Mateo, will reopen for business on Monday morning under Empire's banner.
The Federal Home Loan Bank Board said it closed Equitable because it was "insolvent, had substantially dissipated assets and earnings, and was in an unsafe and unsound condition to transact business."
Equitable, founded in Stanton in 1977, was acquired in May, 1985, by San Mateo-based Vesteq Financial Services Inc., a holding company owned by three real estate investors: Mark W. Stevens, Phillip J. Andrews and Bruce L. Siriani.
At the time of the acquisition by Vesteq, Equitable was insolvent, with a negative net worth of about $837,000, and the new owners pledged to pump about $3.5 million in new capital into the foundering institution.
Regulators said Equitable depositors will have immediate access to their insured funds and may transact business as usual.
However, Equitable's depositors with accounts of $100,000 or more will have to share on a pro rata basis with the Federal Savings and Loan Insurance Corp. the proceeds from the liquidation of Equitable's assets, regulators said Friday.
As of Friday, there were $79.2 million in savings at Equitable, in 7,208 accounts. Regulators said it was unclear how much of the deposits were uninsured.
Equitable is the seventh S&L nationwide to be liquidated and the fourth in Orange County to be shut down this year.
The other closed Orange County institutions--North America Savings, Perpetual Savings and South Bay Savings--are being operated as new federally chartered institutions with new management teams.