THRIFTY GROWTH
Savings and Loans Posted Solid Deposit Growth, Though Pace Slowed
By ANDREW SIMONS
It certainly was a good year for deposit growth at Orange County’s savings and loans.
Just not a great one.
Thrifts operating here reported 10% growth in deposits for the 12-month period ended June 30, according to this week’s Business Journal list, which ranks savings and loans by OC deposits. Data was obtained from the Federal Deposit Insurance Corp.
The 10% growth was slower than the 14% gain thrifts reported on last year’s list, and less than the 18% gain in deposits posted by commercial banks (see story, page 27).
Deposit gains were made for a couple of reasons: a shaky stock market in the latter half of 2002 and into last year had consumers moving their money to safer deposit accounts; and the surge in home loan refinancings led to swelling of deposit accounts.
Overall, the thrifts on this year’s list reported OC deposits of $17.5 billion, versus $15.7 billion for the previous year.
The list is dominated by No. 1 Seattle-based Washington Mutual Inc., the nation’s largest savings and loan. Washington Mutual posted an 11% gain in deposits to $7.3 billion for a 42% share of the OC market,the same as last year. The thrift dwarfs its OC competitors, equaling the total deposits of the three S & Ls; below it.
WaMu saw its earnings fall in the fourth quarter amid a downturn in mortgage refinancings. The thrift, which hired quickly as home-loan refinancings spiked in the past two years, has announced 6,500 job cuts since last summer, though WaMu reported job gains in OC.
“Rising interest rates for mortgages in the second half of the year placed pressure on our business results,” said Washington Mutual chief executive Kerry Killinger in a statement.
World Savings Bank strengthened its grip on the No. 2 spot, with 22% growth in deposits to $3 billion in the period.
“For most of 2003, continued uncertainty in the economy caused consumers to search for predictable, secure investments,” said Marion Sandler, co-chief executive of Oakland-based Golden West Financial Corp.,World Savings’ parent,in a statement. “However, as the year progressed, the economy started to heat up and competition for savers’ dollars intensified, slowing deposit growth.”
No. 3 Newport Beach-based Downey Savings & Loan Association was one of three that reported a drop in deposits. The homegrown thrift saw deposits fall 7% to $2.1 billion, versus a year earlier.
No. 4 Citibank, a unit of New York-based Citigroup Inc., did an about-face. After moving up seven places a year ago on the heels of its buy of former No. 4 California Federal Bank in 2002, Citibank reported a 10% decline in deposits to $2.1 billion.
Rounding out the top five is Western Financial Bank, a unit of Irvine-based Westcorp.
Western Financial broke the $1 billion mark with 35% growth in deposits, versus a year earlier.
No. 6 Irvine-based Commercial Capital Bank moved up two spots with a 107% jump in deposits to $500.3 million, versus a year earlier.
The bigger news for Commercial Capital, though, is last month’s $500 million offer to buy El Segundo-based Hawthorne Financial Corp. Together, the thrifts will have $2.4 billion in company-wide deposits and $4.4 billion in assets. The deal, which must be approved by regulators and shareholders, is expected to close in the summer.
Hawthorne, meanwhile, debuted at No. 10 on this year’s list with $178.9 million in deposits. In 2002, the thrift bought First Fidelity Investment & Loan, which had been chartered as a commercial bank.
Another newcomer: No. 15 Beal Bank with $44.5 million in deposits. Beal bought Southern Pacific Bank last year.
