First Interstate, Chemical N.Y. Both Add to Loan-Loss Reserves

First Interstate Bancorp of Los Angeles and Chemical New York Corp. on Thursday became the latest of the nation’s major banks to make large additions to their loan-loss reserves to cover expected losses on troubled international loans.

First Interstate added $750 million to its reserves and said the action will result in a loss of about $455 million for the second quarter and a “substantial” loss for the year. Chemical New York Corp. added $1.1 billion to its reserves, which will produce a big loss in the current quarter.

First Interstate and Chemical join other major U.S. banking companies in recognizing that a significant portion of their loans to developing countries will never be repaid. Bankers hope that adding to their reserves will strengthen their hand in negotiating with their borrowers and clear the way for more innovative solutions to the 5-year-old debt crisis.

Major U.S. banks are following the lead set last month by New York’s Citicorp, the nation’s largest bank holding company, which set aside $3 billion for bad foreign loans. Citicorp said the action would result in a second-quarter loss of $2.5 billion and a loss for the year of $1 billion.

The moves were prompted by Brazil’s unilateral suspension of interest payments on $68 billion in foreign loans in February. Brazil, which is suffering a severe economic crisis, said it will resume payments when it reaches agreement with its 700 creditor banks that will lessen its debt-service burden.

However, First Interstate said $250 million of its added reserves were to cover troubled domestic real estate loans that it plans to dispose of.

“We felt it appropriate not only to reassess our international debt posture but also to accelerate the disposal of certain domestic non-performing assets, particularly those that are real estate-related,” said Joseph J. Pinola, chairman and chief executive.

First Interstate, the nation’s ninth-largest banking company, said it expects its accelerated sale of bad loans will begin later this year and continue through 1988. Pinola called the action “totally voluntary,” and said the reserves will cover about one-third of First Interstate’s Third World loans.

The company said the extra loan-loss provisions will put its reserves at about $1.2 billion, or 3.7% of loans and leases outstanding. The company said shareholder equity--the surplus of assets over liabilities--will amount to 4.5% of total assets at the end of the quarter.

First Interstate also said it will maintain its current dividend, which was increased earlier this month to an annual rate of $2.80 a share.

Chemical New York said its action will cause a $1.1-billion loss in the second quarter and bring its allowance for possible loan losses to about $2.1 billion, or about 4.1% of total loans.