HomeFed Corp. parent of Home Federal Savings...
HomeFed Corp. parent of Home Federal Savings & Loan, reported a fourth-quarter profit of $32.2 million, up 70% from $18.9 million for the same quarter a year earlier. Full-year profit was $111.3 million, up 11% from $100.3 million in fiscal 1987.
HomeFed Chairman Kim Fletcher attributed the higher profits to lower provisions for probable interest and loan losses as well as to improved net-interest income. Increased profits from HomeFed’s real estate activities were also cited. The S&L; made progress in reducing its non-performing assets to 2.12% of total assets from 2.38% as of Sept. 30.
For the record:
12:00 a.m. Feb. 16, 1989 For the Record
Los Angeles Times Thursday February 16, 1989 San Diego County Edition Part 1 Page 2 Column 6 Metro Desk 2 inches; 47 words Type of Material: Correction
In a Wednesday article in the Business Section, HomeFed Corp.’s 1987 net income and the percentage increase represented by 1988 net income were incorrectly reported. Earnings in 1987 for the parent company of Home Federal Savings, of San Diego, were $103 million. The profit in 1988 amounted to an 8% increase over the previous year.
The company’s interest-rate spread, or the difference between what HomeFed paid on deposits and other liabilities and what it collected in interest from loans and other assets, was 2.71% of assets, up from 2.61% at the end of 1987. A spread of higher than 2.5% is often considered a favorable indication of an S&L;’s earning power by industry analysts.
Another sign of HomeFed’s improved asset quality was that its total provision for probable interest and loan losses in 1988 was $48 million, down from $77.8 million in provisions in 1987.
During the fourth quarter, HomeFed derived income of $14.5 million from real estate development, up from $10.5 million over the same period a year previous. For the full year, income from real estate totaled $44.1 million, up from $34.7 million last year.
HomeFed ended the year with $17 billion in assets, up from $14.1 billion at the end of 1987. The asset growth was due in part to HomeFed’s taking over some $800 million in assets Dec. 30 through the acquisition of three Bay Area S&Ls; with the assistance of the Federal Savings and Loan Insurance Corp.
HomeFed’s regulatory capital at year-end was $1.2 billion, or 7.22% of total regulatory assets. Loan originations in 1988 totaled $6.9 billion in 1988, up from $5 billion in 1987. The percentage of the S&L;’s loan portfolio in adjustable-rate loans at year-end was 78%, up from 71% in December, 1987. Deposits increased over the year by 15.6% to $12.2 billion.
