Westcorp Expects Loss Over Delay of Loan Sale
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Westcorp Inc., the Irvine holding company for Western Financial Bank, said it expects to report a third-quarter loss after delaying the sale of securities backed by $700 million in car loans because of poor market conditions.
The sale now is scheduled for sometime in the fourth quarter, company officials said.
In addition to the loss of income from the securities sale, Westcorp will write off $4 million in the third quarter, as previously announced, as part of a restructuring program. The company earned $8.9 million in the third quarter last year.
Company officials said they believe market conditions will improve sufficiently in the next three months to enable them to profitably market the auto loan-backed securities.
Separately, Western Financial Bank said Tuesday that it will repurchase up to 500,000 shares of stock in its majority-owned subsidiary, WFS Financial Inc.
The announcements were made after the stock markets closed. Westcorp stock closed Tuesday on the New York Stock Exchange at $10.81 a share, down 25 cents. WFS Financial shares closed at $5.81 in the Nasdaq market, down 6 cents.
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