Thrifts Earn Record $2.1 Billion in 2nd Quarter

The U.S. thrift industry earned a record $2.1 billion in the second quarter, fueled by rising income from mutual funds, annuities and other financial products and accounts, the Office of Thrift Supervision said. Earnings were up 23.5% from a year ago and were 10.5% higher than the previous quarter, the OTS said. A key reason for the jump was that California Federal Bank reaped a one-time $250-million tax benefit during the quarter. The average return on assets, often a key indicator of an institution’s profitability, rose to 108 basis points from 97 basis points in the first quarter, the OTS said. In the year-earlier quarter, thrifts recorded an average return of 89 basis points. Meanwhile, the number of problem institutions jumped to 18 from 14 at the end of the first quarter. Delinquent loans and other troubled assets fell to $6.8 billion, down 6.8% from the first quarter and down 16% from a year ago.