Ahmanson, Gibraltar Post Higher Profits
H. F. Ahmanson & Co. said Thursday that its earnings more than quadrupled to $221 million in 1985, a record high for the Los Angeles-based parent company of Home Savings of America.
Earnings for the fourth quarter of the year also set a record of $68.9 million, Ahmanson said. In 1984, the company had annual earnings of $54.6 million and fourth-quarter earnings of $20.1 million.
Gibraltar Financial Corp., another large Southern California-based savings and loan holding company, reported Thursday that its 1985 earnings reached $38.9 million, or 16% more than it earned in 1984. But Gibraltar said its 1985 fourth-quarter earnings fell 4% to $6.97 million because of a one-time profit of $2.71 million in the fourth quarter of 1984--the result of a dividend from the Federal Home Loan Bank Board.
Both earnings reports come one day after Great Western Financial Corp. said it made $202 million in 1985, the best 12 months in its nearly 100-year history.
Ahmanson said it has benefited from dropping interest rates--which reduce the amount it pays depositors for their savings--along with record loan volumes.
Richard H. Diehl, president and chief executive of Ahmanson, noted that new loans in the fourth quarter totaled $2.35 billion, the “highest of any quarter in the company’s history.” The company also noted that the interest cost of its money was 8.03%, a decline of 1.82 percentage points since the end of 1984.
Ahmanson said its results include a one-time loss of $5.6 million in connection with the expected sale of most of its property and liability insurance operations. The company said last September that it was discontinuing those operations in all states except Nebraska.
Ahmanson also noted that its profits received a boost from $4.5 billion of loan sales into the secondary market, resulting in profits of $88.5 million. Ahmanson’s assets for the year increased 12% to $27.2 billion.
Gibraltar Chief Executive Herbert Young noted that lower interest rates have allowed the company to restructure its assets by selling off loans and concentrate on making adjustable-rate mortgages.
As a result, Gilbraltar has been able to resume a “program of prudent growth,” Young said. Gibraltar’s assets stood at $9.9 billion at year-end, up 6% from the end of 1984.
