The nation's big thrifts have been saying for the last few years that all they needed was a nice rise in interest rates to let them start building their assets again after a long string of declines. (See tables beginning on page 12).

Now the time has come for them to put up or shut up. Interest rates have surged with unusual suddenness, the mortgage refinancing boom has ended, and adjustable-rate mortgages are be back in fashion.

So the thrifts have a chance to roar again, perhaps for the first time in a decade. The only major uncertainty is the state of the economy in California, where many large thrifts are based.

Adjustables Surging

At Irwindale, Calif.-based Home Savings of America, the nation's largest thrift, ARMs are already flying high. Some 99% of the loan applications being received these days are for adjustable-rate mortgages, up from less than 80% a year ago, according to a spokeswoman.

Charles Rinehart, chairman of Home, said, "We'll have some asset growth this year. I don't know whether it will be more than last year. That will depend on the economy."

Strength in Purchase Market

Home Savings had one of the stronger gains in assets last year among the top thrifts, about 5%. The top 300 institutions had a decline of 2.3% and the industry as a whole 4.1%. Over the last five years, assets of the top thrifts have shrunk from a bit more than $1 trillion to about $750 billion.

Mr. Rinehart said the absolute volume of ARMs was growing and that the market for loans to buy homes was fairly strong.

Larry Byrne, vice president for mortgage banking at Great Western Financial Corp., Chatsworth, Calif., said fixed-rate loans had been about a third of the thrift's originations during the refi boom but now they amounted to 5% or 10%. "We're seeing applications increasing," he added.

But some observers suggest that the a thirst for rapid growth may be the thrifts' undoing. "Pricing of ARMs has become absurd," said Bruce Harting, an analyst with Salomon Brothers, New York. He added that CD rates were due to rise significantly from their present abnormally low levels, and that this could cause ARMs volume to drop later in the year.

Mr. Byrne and Mr. Rinehart both said, however, their companies were shunning the price competition.

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