Eldorado Bancorp Says Year’s Earnings Should Set Record

Based partly on a strong third quarter, Eldorado Bancorp, the holding company for Eldorado Bank in Tustin, joined the ranks Monday of the few Orange County financial institutions that are projecting a record net income for the year.

J.B. Crowell, the company’s president and chief executive officer, estimated that Eldorado’s annual net earnings this year will hit $1.8 million to top the company’s previous record of $1.7 million in 1982.

Other institutions predicting record years include Mercury Savings & Loan Assn. in Huntington Beach and Mission Viejo National Bank.

Lower costs and higher productivity helped Eldorado Bancorp to post a net income of $548,000 in the third quarter, a 67% increase from $329,000 earned in last year’s third quarter. In the first nine months, the company’s net earnings grew 43% to $1.35 million from $948,000.

The company’s assets at the end of September were $175.6 million, a 3.8% increase over $169.2 million in assets a year earlier.

Crowell said the company’s efforts will help it to “continue to be a formidable competitor in the new regional and interstate banking environment.”

The 14-year-old bank, the company’s sole subsidiary and primary asset, benefited from improved interest margins--the money it earns on loans and investments minus the money it pays on deposits and borrowings--and a strong performance overall, he said.

The bank’s loan portfolio, up 13.7% to $113.7 million at the end of September from $100 million a year earlier, consists primarily of commercial, real estate and installment loans made in Southern California, Crowell said.

The bank also has cut foreclosed real estate it owns to less than $100,000 from its peak of $2 million in 1984. Its non-performing assets, primarily loans that are more than 90 days past due, were lowered by the end of September to $1.5 million from $2.07 million a year earlier. Such assets amount to 1.3% of total loans and leases, lower than last year’s industry average of 2.04% for California banks.

The bank’s total deposits rose 4.1% to $158.3 million at the end of the period from $152 million. The bank has reduced the amount of its $100,000 “jumbo” certificates of deposit--often considered volatile and expensive money--to $15.8 million at the end of September from a high of $49 million at the end of 1982.