Wedbush Sells More S&L; Stock : Banking: Company continues to reduce its holdings in troubled Great American.

Wedbush Corp., which recently disclosed that it had reduced its holdings in Great American Bank, has sold off still more of its stock in the troubled savings and loan.

According to a filing with the federal government, Wedbush sold 263,600 Great American shares between April 16 and April 20 for $914,000, an average net sale price of $3.47 per share. Moreover, sources close to the S&L; say Wedbush has sold an additional but unspecified number of Great American shares since April 20.

Combined with a previous sale of 416,000 Great American shares disclosed this week, the sale left Wedbush with control of 3,394,323 Great American shares, or 14.2% of the total outstanding. That is down nearly 680,000 shares from the 4,074,023-share, 17% holding it owned a year ago at this time. Wedbush is still Great American’s single largest shareholder.

Wedbush Chairman Ed Wedbush, who is also a member of Great American’s board of directors, was unavailable to comment on the reasons for the stock sales. Great American stock closed unchanged at $3 a share in light New York Stock Exchange trading Wednesday.

Insider stock sales, or those by corporate officers and directors such as Wedbush, are generally a negative sign for a stock. Word of the sale comes at a time when capital-deficient Great American is trying to avoid government seizure by raising outside capital or by selling itself in part or whole to outside financial interests.

There was speculation that Wedbush’s stock sale could be prompted by a “margin call,” an event prompted when a brokerage or lender demands payment from an investor for shares acquired with borrowed money.

Margin calls are sometimes triggered by a steep decline in a stock’s price and Great American’s stock, which closed Wednesday at $3, has traded as high as $14.875 over the past year.

Wedbush’s filing details the heavy losses that it has taken on its Great American investment. According to the documents, Wedbush paid $41.2 million or an average $12.22 per share for the Great American shares it still holds. That investment is now worth $10.1 million, meaning Wedbush’s paper loss on its remaining Great American stock is $31.1 million.

Regulators have given Great American until Dec. 31 to raise additional capital, drastically shrink assets or find a buyer. A handful of outside investors and banks, including Security Pacific Bank, Bank of America and the Robert M. Bass Group, owners of American Savings, are known to be interested in Great American, which has 211 branches and $15.9 billion in assets.

However, the threat of a government seizure remains real, particularly if Great American reports a large enough first-quarter loss to further weaken its tenuous capital base. As of Dec. 31, Great American’s tangible capital was down to $85.9 million, roughly one-third the amount that regulators like to see in an S&L; its size.