Another bidder has entered serious negotiations to acquire Financial Corp. of America, a spokesman for the Federal Home Loan Bank Board said Thursday.
The new entry thus becomes a rival to the current leading contender, First Nationwide Bank in San Francisco, a subsidiary of Ford Motor Co. First Nationwide officials have publicly confirmed their interest in buying Irvine-based FCA, whose operating subsidiary is American Savings & Loan, the nation's biggest S&L.
Although the bank board declined to identify the new bidder, agency spokesman Karl T. Hoyle said, "I have no doubt it is a serious bid." As the top regulatory agency for savings and loan firms, the board is orchestrating the attempt to find new capital for American Savings.
Executives at FCA and First Nationwide were not available for comment.
The recent drop in interest rates has apparently enhanced the attractiveness of American Savings, which has an $18-billion portfolio of mortgage-backed securities. The market value of these debt securities goes up as interest rates come down.