County Thrifts Back in Black After 2 Years

Orange County’s 24 savings and loans, benefiting from lower interest rates on deposits and bigger profit margins, posted their first quarterly profit in two years, chalking up combined earnings of $68 million.

In last year’s first quarter, the local thrift industry lost $147 million, mostly because of losses at failed institutions operated by federal regulators. But regulators have since closed out the biggest basket cases, such as Lincoln Savings & Loan in Irvine and Mercury Savings & Loan in Huntington Beach.

Now county S&Ls; stand a good chance of posting an annual profit for the first time in nearly a decade.

More important to the local recovery, industry experts said, is the larger profit margins at S&Ls.;

“For people in Orange County, profits will continue through the year,” said Maurice L. McAlister, president of Downey Savings & Loan in Newport Beach.

The losses have narrowed even for the three thrifts now in government hands. FarWest Savings & Loan in Newport Beach, the county’s biggest failed S&L; with $3.1 billion in assets at the end of March, limited its quarterly loss to $7.5 million.