HomeFed Corp.: The San Diego-based parent of...

HomeFed Corp.: The San Diego-based parent of HomeFed Bank reported a drop in its third-quarter earnings to $23.9 million from $27.9 million in net income reported for the same three months last year.

This year’s results were negatively impacted by larger loan loss provisions and by a $4-million loss taken on HomeFed’s discontinued Partners real estate brokerage network. Total provisions for probable loan, interest and foreclosure losses were $22.9 million during the quarter, up from provisions of $10 million for third quarter of 1988.

The higher reserves were prompted by an increase in HomeFed’s nonperforming assets. As of Sept. 30, bad loans represented 2.85% of HomeFed’s $17.9 billion in total assets, up from 2.45% of assets a year earlier. The savings and loan blamed the increase in bad loans on slower than expected sales of foreclosed real estate.

Without unusually high income from its real estate development operations, HomeFed’s third-quarter profit would have dipped even further. Real estate income for the three months totaled a record $21.7 million, up from real estate income for $12.7 million in 1988’s third quarter.

Last week HomeFed Corp. announced it was changing the name of its operating unit, Home Federal Savings & Loan, to HomeFed Bank. The company also changed from a federally chartered S&L; to a federally chartered savings bank.

For the year to date, HomeFed’s profit stands at $82.5 million, up from $79.1 million for the same three quarters last year.