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Banks Beat Forecasts Amid Growth

October 18, 2002|E. Scott Reckard | Times Staff Writer

The companies that operate Union Bank, World Savings and California Federal Bank reported higher earnings Thursday despite the struggling economy, as low interest rates drove demand for mortgages, deposits increased and no new lending problems surfaced.

* Union Bank's parent, UnionBanCal Corp., earned $138.2 million, or 88 cents per share, for the quarter that ended Sept. 30, up 10.5% from $125.1 million, or 79 cents per share, in the same period a year earlier. Revenue for the San Francisco-based bank rose 4.2%, from $552 million to $575.1 million. Troubled loans decreased despite what Chief Executive Norimichi Kanari called "challenging business conditions."

* CalFed's parent, Golden State Bancorp Inc., earned $128 million, or 88 cents per share, for the quarter that ended Sept. 30, up 24% from $103.3 million, or 72 cents per share, in the third quarter of 2001. The San Francisco-based savings and loan is in the process of merging with Citigroup Inc.

* World Saving's parent, Golden West Financial Corp. in Oakland, earned $244.5 million, or $1.56 per share, for the quarter that ended Sept. 30, up 18.8% from $205.8 million, or $1.28 per share, in the same quarter a year earlier. Revenue rose from $471.4 million to $553.5 million, a gain of 17.4%. Chairman Herbert M. Sandler attributed the higher profit to growth in mortgages, plus a wider spread between the interest rates Golden West earns on loans and the rates it pays to depositors.

All three companies beat analysts' expectations for earnings, and their stocks, which all trade on the New York Stock Exchange, rose: Golden West was up $2.39 to $68.27; Golden State Bancorp rose $1.16 to $35.67; and UnionBanCal gained $1.50 to $42.10.

That helped boost shares in other California banks and thrifts including Downey Financial Corp. and City National Corp., both of which had fallen on Wednesday after less rosy earnings reports.

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