H.F. Ahmanson & Co. and Glenfed Inc., two major California thrift companies, reported second-quarter losses on Thursday that reflected the state's depressed real estate market.
But analysts said the red ink at Ahmanson was a sign of strength while Glenfed's loss represented a setback in its efforts to prevent a federal takeover.
Separately, Dime Savings Bank, the East Coast's biggest thrift, eked out a profit of $3.2 million but would have reported a loss without capital gains.
The nation's largest thrift company, which ended the quarter with $50 billion of assets, lost $290.9 million compared with a profit of $67.1 million for the second quarter of 1992.
The Irwindale-based thrift, which preannounced its results earlier this week, said the loss was prompted by the bulk sale of $1.2 billion of delinquent home loans and a $163 million loan-loss provision for real estate development projects.
Ahmanson is selling the home loans to Bear, Stearns & Co. at prices estimated to range between 74% and 79% of face value. Analysts have applauded the deal as a quick way to eliminate credit problems burdening many banks and thrifts. Ahmanson said the sale will reduce its nonperforming assets to about $1 billion - or 2.04% of total assets - from a peak of about $2.3 billion at the end of September 1992.
Ahmanson said it expects to report profits in the third and fourth quarters, but anticipates a loss for the year as a result of the second-quarter events. In trading Thursday afternoon, the company's stock fell 25 cents to $19.75 a share.
The nation's fifth largest thrift company, based in Glendale, lost $29.9 million for the quarter, slightly more than the $26 million deficit posted in the same period a year ago. Glenfed blamed the loss on continuing loan quality problems, a revenue slump, and a sharp decline in core deposits.
Glenfed's sixth consecutive quarterly operating loss came as it is trying to sell about $400 million of stock in order to meet federally mandated capital guidelines. Failure to reach the targets could prompt regulators to seize its main thrift unit, Glendale Federal Bank.
As an interim target, Glenfed must achieve a 4.5% core and 9% risk-based capital ratios by the end of September. It ended the second quarter with those ratios at 2.65% and 5.77% respectively.
The second-quarter loss, though not surprising, may discourage potential investors, analysts warned.
"It's going to be very difficult for them to generate any enthusiasm," said E. Gareth Plank of Mabon Securities.
Glenfed's stock lost 12.5 cents, trading at $1.25 Thursday afternoon.
During the quarter, the company registered modest improvement in credit quality. Nonperforming assets and restructured loans fell to $938.2 million, or 5.15% of assets, from $970.5 million at the end of March.
But Glenfed ominously reported an outflow of $2.1 billion of consumer deposits over its last fiscal year, which ended on June 30. It blamed the exodus on its "financial difficulties and resulting publicity of those difficulties." The deposits had to be replaced with about $2.2 billion of expensive short-term wholesale borrowings, the company said.
The Dime Savings Bank of New York earned $3.2 million in the second quarter, down 63% from its year-earlier gain of $8.6 million.
Without capital gains, it would have lost $5.4 million before taxes, said Gary Ford, an analyst at Smith Barney, Harris Upham & Co.
In afternoon trading on Thursday, Dime's shares were unchanged at $7.125.
The company's credit quality improved, as nonperforming assets fell by $118.3 million during the quarter. But the Dime also suffered a major decline in net interest income, leading to an interest rate spread that plunged 51 basis points to 2.87% from one year earlier and 21 basis points from the first quarter of this year.
"The margin is way down," said Mr. Ford. "We didn't expect it to be that bad."
Richard Parsons, chairman and chief executive of Dime, attributed the decline chiefly to the thrift's decision to shed assets. The 34-branch company sold 20 branches this year and saw its assets fall 17% over the past 12 months to $8.2 billion.
The Dime also suffered from prepayments on mortgages that could not be reinvested at high yields, and was forced to redeem some municipal bonds to help with financing transactions.
The Dime signaled some economic optimism, noting that residential delinquencies are declining. Only $69 million of residential loans were put on nonperforming status during the quarter compared with $80 million in the first quarter and $133 million in the second quarter of 1992.
The Dime said its capital ratios are ahead of special targets established for it by the Office of Thrift Supervision.