EARNINGS : Record ’89 Profit at B of A; Other Banks’ Results Mixed

BankAmerica Corp., which struggled through most of the 1980s before mounting a comeback three years ago, said Thursday that it posted a slight gain in fourth-quarter profit and a 52% jump in full-year net income.

The San Francisco-based banking company, parent of Bank of America, said earnings in the fourth quarter rose to $270 million from $265 million a year earlier. In the 1988 fourth quarter, BankAmerica reported $351 million in interest income that it did not have in the most recent period.

For all of 1989, the company earned a record $1.1 billion, up from $726 million in 1988.

BankAmerica, the nation’s third-largest banking firm, attributed the fourth-quarter increase to more money from fees on loans and on customer accounts, fewer bad loans, cost controls and an increase in volume of loans to consumers for homes, cars and on home equity arrangements.

The bank said it has set aside money in reserves to cover 47% of its $5.7 billion in medium and long-term loans to developing countries.

BankAmerica, hurt by bad foreign loans and a bloated structure, suffered huge losses in the mid-1980s. The company lost $337 million in 1985, $518 million in 1986 and $955 million in 1987. As pressure mounted from concerned regulators, the bank forged a successful turnaround by eliminating nearly 30,000 jobs over four years, selling off unneeded assets and writing off bad loans.

Elsewhere in California, CalFed, parent of California Federal Bank, said its earnings rose 22% in the fourth quarter to $23.6 million from $19.3 million a year earlier. The Los Angeles-based thrift posted a $24.1-million gain before taxes stemming from the sale of its 443,000-square-foot headquarters building.

For all of 1989, CalFed’s earnings fell nearly 39%, to $82.4 million.

Separately, Chemical Banking Corp., which has been allocating money to cover bad foreign loans, reported earnings of $95.9 million in the fourth quarter, off 67% from year-ago quarterly earnings of $288.5 million.

The New York-based parent of Chemical Bank reported a loss for 1989 of $482.2 million, due mainly to its third-quarter addition of $600 million to Third World loan-loss reserves and a $300-million special provision to cover real estate credit losses at its Texas Commerce Bankshares Inc. subsidiary. In 1988, the corporation earned $753.6 million.