Valley Federal Posts $5.45-Million Profit

Valley Federal Savings and Loan in Van Nuys said it “slightly exceeded” earnings targets that the capital-poor thrift agreed upon with the federal government, posting a profit of $5.45 million in the third quarter ended Sept. 30, compared to a loss of $70.7 million in the same quarter a year earlier.

Valley Federal is required to meet targets in a capital plan approved in May by the federal Office of Thrift Supervision, since the S&L; falls far short of requirements for capital reserves, which are meant to provide a cushion against potential losses.

As of Sept. 30, Valley Federal had a deficit of $22.3 million in tangible capital; that measure is essentially equal to the net worth of the institution minus the value of some non-cash assets. But that marks an improvement since Dec. 31, 1989, when Valley Federal had a tangible capital deficit of $43.5 million.

For the nine months that ended Sept. 30, Valley Federal earned $21.5 million, compared to a loss of $73 million for the period in 1989.

Valley Federal had total assets on Sept. 30 of $2.72 billion, a 14% decline from $3.17 billion a year ago.