Many Banks, Thrifts Report Profit Increase : Finance: The industry has generally benefited from falling interest rates, which boosted income as deposit costs fell.

H. F. Ahmanson, the parent company of Home Savings of America, reported improved earnings in the third quarter, while a main competitor, Great Western Financial, reported a loss as it continues to wrestle with problem assets.

Meanwhile, Citicorp, the nation’s largest bank, said its earnings jumped nearly fivefold, while Wells Fargo’s profits were six times what they were a year ago. Banc One Corp., a regional bank based in Columbus, Ohio, and Chemical Banking Corp. of New York also reported higher profits.

Banks and thrifts have generally benefited from falling interest rates, which have boosted profits as deposit costs have fallen. Several major institutions--including Home Savings, Citicorp and Chemical--also reported progress in getting problem loans under control.

Ahmanson, based in Irwindale, said profits increased mainly because it took a smaller provision for loan losses. The savings and loan company earned $70 million, up from $50.7 million a year ago; it set aside $22.2 million for loan losses compared to $73.7 million a year ago.

Chatsworth-based Great Western Financial Corp. reported a loss of $17.5 million, compared to a profit of $31.7 million in the third quarter of 1992. Great Western set aside $232 million in loss provisions in preparation for selling some $475 million in delinquent loans and foreclosed real estate in bulk sales.

The $232-million loss provision for the third quarter compares to a $129-million provision last year. The loan losses were offset by Great Western’s $43-million gain on the sale of its credit card operation during the quarter.

Home Savings’ non-performing assets as of Sept. 30 were 2.05% of $50.1 billion in total assets, down sharply from 4.91% a year ago.

Once its bulk sale of $475 million in bad assets is completed later this year, Great Western said it expects its bad loans to drop to 3.07% of $37.6 billion in assets--down from 5.2% last spring.

Although he commended both thrifts for their actions to reduce problem loans, Paine Webber thrift analyst Gary Gordon described both thrifts’ earning performances as “pretty weak.”

Citicorp said its earnings jumped to $527 million from $116 million a year ago, boosted by gains on securities trading and faster than expected declines in credit costs. Wells Fargo’s profit soared to $165 million from $24 million, mainly because the bank’s bad loan provision fell to $121 million from $264 million.

Chemical Banking Corp. earnings increased to $502 million from $282 million the year before, partly because of $73 million in onetime gains, including tax benefits. Banc One said its net income was $285 million, up from $246 million, despite a $39-million increase in bad loan and lease provisions.