Regulators Seize Pasadena’s Progressive Savings Bank

Citing a growing number of problem loans, federal thrift regulators on Friday seized the long-troubled Progressive Savings Bank in Pasadena.

Officials from the Office of Thrift Supervision said Progressive has a large number of risky construction, commercial and apartment loans and was plagued by poor loan underwriting. As of Dec. 31, Progressive’s troubled loans totaled $92.3 million, or nearly 25% of its $388.8 million in assets.

As a result of the losses, regulators said, Progressive’s $1.2 million in capital, or the financial cushion institutions maintain to protect against losses, was insufficient.

The thrift’s six branches--in Pasadena, Alhambra, Irvine, Long Beach, Tarzana and West Covina--will remain open under normal hours, regulators said. Deposits are insured up to the legal limit of $100,000.

The Resolution Trust Corp., the federal agency charged with cleaning up the nation’s savings and loan mess, will operate Progressive.

Formerly based in Alhambra, Progressive was plagued by problems through much of the 1980s. It was nearly sold in 1987 to Far West Savings & Loan in Newport Beach, which also is being operated now by regulators.