U.S. Regulators Take Control of Westwood S
Moving in after the close of business Thursday, the Federal Home Loan Bank Board declared Westwood Savings & Loan Assn. insolvent and named the Federal Savings and Loan Insurance Corp. as conservator for the institution.
Bank board spokesman David Loveday said Westwood will “continue to conduct business as usual, maintaining its name, normal operating hours and services. Westwood deposits will continue to be insured by the FSLIC.”
Westwood, a state-chartered stock association with $554.2 million in assets, operates six offices in Santa Monica, Encino and the Westside of Los Angeles.
The state Department of Savings and Loan recently had placed strict operating restrictions on Westwood because state regulators charged that the S&L; was in an “unsafe and unsound condition.”
The bank board’s action Thursday was taken in concurrence with state regulators.
Big Real Estate Loans
Loveday said Westwood “had engaged in a rapid growth strategy largely through the intake of brokered funds. The institution made large loans to syndicators, invested in real estate and made large investments in a newly established service corporation, WSL Financial Corp. The association’s insolvency resulted in large part from losses on such loans and investments.”
In a related move, the bank board authorized the FSLIC to enter into a management agreement for Westwood with Coast Savings & Loan.
In addition, the bank board appointed a three-member advisory board to advise the FSLIC on Westwood’s general policy. The members include:
- George H. Coffin III, a principal of George H. Coffin & Son, a real estate and mortgage lending consulting firm. Coffin is a former vice president of Investors Mortgage Insurance Co. and will serve as chairman of the new advisory committee.
- Robert F. Jordan, a retired investment manager and consultant. Jordan is a former partner of Jordan, Herbert & Co. and served as an auditor for 35 S&Ls.;
- David E. Devol, former president of Rancho Bernardino Savings & Loan of San Diego.
