UnionFed Financial Posts $64.7-Million Loss in Year

Blaming continuing weakness in the real estate market that swelled its losses for the fourth quarter, the parent company of Union Federal Savings Bank reported Friday that it lost $64.7 million for its fiscal year ended June 30.

UnionFed Financial Corp.’s losses, which amounted to $8.68 per share, were more than triple last fiscal year’s loss of $18.1 million, or $2.39 per share.

UnionFed said it lost $41.1 million in the fourth quarter alone, up 33% from a $30.9-million loss in a year ago.

Chairman David S. Engelman said in a statement that the losses came after a detailed review of the Brea-based company’s real estate holdings during the fourth quarter.

“Both the bank’s and the (Office of Thrift Supervision’s) reviews reveal continuing weakness in real estate markets,” Engelman said. As a result, the company had to set aside more funds to cover the projected losses. He also warned that, depending on market conditions, the losses may continue in the new fiscal year.

UnionFed said its combined loan and real estate loss provision totaled $53.2 million for the quarter, compared to $53 million for the year-ago period. For the year, those loss provisions were $90.7 million, up from $60.7 million.

UnionFed said its top losses for the year were: $15.2 million on Southland single-family housing; $13.5 million for real estate in Key West, Fla.; $7.6 million for six hotels, and $3.2 million for commercial properties in Maine.