WASHINGTON — The nation's shrinking savings and loan industry reported net profits of $271.8 million during the third quarter, although California thrifts suffered substantial losses because of troubled real estate markets, federal regulators reported Wednesday.
The government is in the "seventh or eighth inning" of its cleanup of financially crippled S&Ls, having seized nearly 600 insolvent institutions, Timothy Ryan, director of the Office of Thrift Supervision, told a news conference.
The $272 million amassed between July and September marked the third consecutive profitable quarter. It was the longest string of positive quarters since 1986.
However, California thrifts had overall losses of $127.2 million during the year's third quarter. The state has many of the nation's major thrift institutions and controls $300 billion of the industry's total holdings of about $900 billion.
The losses indicate temporary problems and do not signal a major slump among California thrifts, Ryan said. He noted that the state has a lower proportion of delinquent loans than the national average and that these loans have not been rising.
"There's nothing here that's very alarming," Ryan said of the overall California situation with its many diverse markets. The central business district of Los Angeles "is not in good shape, but San Francisco appears to be relatively" strong, he said.
People in California "have been very spoiled," he said. "It's been such a robust economy for so long that any change is disturbing to them. The bottom line is, it's not (depressed like) New England, and we hope it stays that way."
The Resolution Trust Corp., the agency handling the disposition of failed thrifts, also announced Wednesday that it is putting on sale 53 thrifts in 27 states. These failed S&Ls have total assets of $17.7 billion.
The RTC was just given $25 billion by Congress to spend on the cleanup and will use the money to cover losses at the S&Ls it has placed on sale. The RTC funds will fill the gap between deposits and the value of mortgages, loans and real estate properties that have declined in value.
How S&L Profits Are Faring Here is a list of savings and loan profits, or losses, by state for the third quarter of 1991. The figures, provided by the Office of Thrift Supervision, are in millions of dollars. The agency did not provide comparison figures for last year.