The Bauer Group, a Florida firm that rates financial institutions, likes Orange County banks but is not too keen on the savings and loans here.
Just two banks, two S&Ls and two thrift and loans made Bauer's top five-star grade for last year. But 26 of the remaining 43 banks and thrift and loans were given four-star ratings, while just one of the remaining 21 S&Ls got as many as four stars.
Bank of Orange County in Fountain Valley and Commercial Center Bank in Santa Ana, both of which suffered through major problems in the 1980s, were Bauer's "safest" bank picks. Standard Pacific Savings and tiny Pioneer Savings & Loan, both in Newport Beach, took top grades for S&Ls. First American Thrift Co. in Santa Ana and First Security Thrift Co. in Orange were the five-star thrift and loan winners.
No bank or thrift and loan received less than a two-star rating, but two S&Ls--Guardian Savings & Loan in Huntington Beach and San Clemente Savings & Loan in Irvine--were given one-star ratings. These, Bauer said, indicate that they are "troubled" S&Ls.
Bauer did not rate Downey Savings & Loan in Newport Beach or Beverly Hills Federal Savings Bank in Laguna Hills because they are still receiving government payments for the failed thrifts they took over. Both are healthy institutions, and analysts consider Downey one of the best run S&Ls in the nation.
Bauer said its ratings are based on a complex formula that includes historical trends, loan delinquencies, repossessed assets, reserves and asset quality. Bauer also said its ratings are conservative and may be lower than ratings by others.