BANKING/FINANCE : Good News Is 14 S&Ls; Exceed Capital Levels Required by Late ’94

One of the brighter notes in the dismal first-quarter earnings of Orange County savings and loans is that 14 of the still solvent, independently owned thrifts exceed all three levels of capital that the federal government will require of thrifts by the end of 1994.

In addition, according to recently released figures by thrift regulators, three others meet current requirements, which gradually increase to the fully phased-in levels in four years.

For a capital-starved industry, that’s good news.

Regulators and legislators want S&L; owners to put more of their money at risk, figuring that owners won’t be so reckless in investing other people’s money if they they stand to lose their own. Capital is nothing more than what the owners put in to start and grow a business and what they rely on to absorb unforeseen losses.

Besides the 17 county S&Ls; that meet current or future requirements, four other thrifts failed only one test at the end of the first quarter. Guardian Savings in Huntington Beach failed two of the tests, and FarWest Savings in Newport Beach failed all three. Both are still solvent, however.

In addition to the 23 solvent thrifts, seven failed thrifts and a special thrift set up by regulators to liquidate the bad assets from the old American Savings & Loan called Orange County home at the end of March.