Refinancing of Home Loans Boosts Plaza’s Quarter Earnings : Thrifts: The corporation’s net quarterly income jumped nearly fivefold--a record $4.3 million--over the third period last year.

The surge in refinancing home loans boosted third-quarter earnings for the holding company of Plaza Savings & Loan to a record $4.3 million, or 40 cents a share, the company said Tuesday.

Plaza Home Mortgage Corp.’s net income was a nearly fivefold increase over $912,000, or 8 cents a share, earned in the third quarter last year. Quarterly revenue surged 73% to $18.2 million this year from $10.5 million last year.

Refinancings also spurred nine-month results as the company posted net income of $11.2 million, or $1.04 a share, nearly double $5.9 million, or 55 cents a share, earned in last year’s first nine months. Revenue rose 49% to $52.5 million for the period from $35.2 million last year.

The earnings per share reflect the company’s initial public offering earlier this month, which gave the company 10.8 million shares outstanding.

Plaza Savings in Santa Ana, the company’s only asset, is a major mortgage banking operation despite its small size with $374.4 million in assets at the end of September.

It uses both deposits and borrowings to make home loans, sells those loans to investors and uses the proceeds to make more loans. The activity generates both fee income and income derived from servicing the loans sold.

The company funded $1.4 billion in mortgages during the third quarter, an increase of 59% over $879 million originated in last year’s third quarter. It increased its loan servicing portfolio--essentially billing and collections--to $2.6 billion in mortgages by the end of the quarter from $2.4 billion at the end of June.

“I wish we could count on this (refinancing) all the time,” said John T. French, Plaza Home Mortgage’s chairman and chief executive.

Pessimistic about California’s chances to recover quickly from its recession, French is opening offices in other states where the recovery is faster. Plaza opened an office in Oregon earlier this year and recently opened offices in Arizona and Florida. The company has targeted four other states for expansion, he said.

“We see a need for geographic balance and diversity,” he said.

Plaza Savings’ assets at the end of September were 90% higher than the $196.6 million recorded a year earlier. But French maintains that asset size means little to a company devoted to generating and selling loans.

The thrift’s ratio of basic capital to assets was 7.8% at the end of September, more than double the 3% ratio regulators demand. Its capital ratio based on risky assets is 13%, well above the 7.2% requirement.