FCA Loses Its No. 1 Ranking as Assets Drop

Financial Corp. of America has lost its position as the nation’s largest savings and loan company to H. F. Ahmanson & Co., parent of Home Savings of America.

FCA, the troubled parent of American Savings & Loan, reported Wednesday that its assets declined to $26.44 billion during the first quarter of 1986, below the $27.2 billion in assets reported by H. F. Ahmanson recently. At the end of the first quarter a year ago, FCA’s assets were $28 billion.

FCA reported income of $49.1 million for the first quarter, compared to a $38.1-million loss in the same quarter a year ago. Most of this year’s profit was earned from selling loans and mortgage-backed securities.

The company, based in Irvine, disclosed that it lost $7.2 million from operations during the first quarter, compared to the $16 million that it earned from operations in the fourth quarter of 1985.

Layna J. Browdy, FCA spokeswoman, said the operating loss was related to the cost of maintaining and developing real estate that the company has acquired though foreclosures.

Surge in Mortgage Lending

FCA said it added $25.4 million to its reserve for loan losses during the quarter, bringing the total to $571.9 million.

The company said its earnings reflect a gain of $85.5 million on the sale of $2.42 billion in mortgage-backed securities as FCA benefited along with other savings and loans from the surge in mortgage lending caused by the recent drop in interest rates. FCA’s first-quarter earnings also included a $17.6-million tax-loss carry-forward.

FCA said non-performing loans increased to $1.85 billion from $1.7 billion on Dec. 31, 1985, due to an increase in non-performing real estate loans, mostly in California. Although problem loans have dropped from $1.98 billion in February, non-performing loans still make up about 7% of FCA’s regulatory assets--twice the percentage carried by most S&Ls.;

FCA apparently is not troubled by its drop to second place. In a letter mailed to shareholders on Tuesday, Chairman and Chief Executive William J. Popejoy said that his goal is to make FCA the nation’s strongest thrift institution and that “if this means we can no longer be the No. 1 savings and loan in terms of asset size, that’s fine with us.”

The company’s stock decreased $2.12 1/2 a share on the New York Stock Exchange on Wednesday, closing at $12.87 1/2.