RTC Improves Its Operations in Costa Mesa : Bailout: Officials say things are “beginning to move” at the office, which has been bogged down in red tape for 19 months.

The federal agency charged with cleaning up the savings and loan disaster has been patching up its own West Coast office, which has been mired in bureaucratic red tape and inaction since it opened 19 months ago.

The Resolution Trust Corp. is beefing up its coastal consolidated office in Costa Mesa and straightening out its operating procedures. That has brought improved results in disposing of loans, securities, real estate and other assets from failed thrifts.

The coastal office sold $8.1 billion in loans, securities and real estate from failed California thrifts during the first nine months of the year, said RTC officials who gathered Wednesday in Los Angeles for an update on the agency’s efforts in the Western region.

The sales figure exceeds a $5.6-billion goal set for the fast-growing coastal office, but that goal seemed unattainable for much of the period. Most of the sales--$6.6 billion--came in August and September.

“Things are beginning to move,” said Frederick D. Smith, deputy director in charge of the agency’s sales center in Costa Mesa.

Even in the face of California’s sagging real estate market, the West Coast office projects sales of $500 million worth of property in the next 12 months, Smith said.

“Despite the recession, the California real estate market is still perceived as a strong market,” said Sherwin Koopmans, director of RTC’s Western region in Denver.

The coastal office still has $21.1 billion in assets from 55 failed California thrifts. More thrift failures are expected, and the office, which will move its headquarters to Newport Beach by year-end, is increasing its 359-person staff by 210, said office director Joseph G. Honescko.

For the most part, the coastal office is recouping 81% to 101% of the designated value of assets, Smith said. He acknowledged that there have been exceptions. A $100-million package of bad auto loans, for instance, sold for 12 cents on the dollar.

Most of the assets held by the coastal office are performing loans on homes and apartment buildings. The RTC is using those loans in a new program in which the mortgages are packaged and sold to underwriters, who use the pool to back securities they, in turn, sell.

The agency has sold $5.1 billion in such mortgage-backed securities, relying primarily on loans at failed California thrifts.