FarWest Savings Posts Third-Quarter Loss of $22.9 Million
NEWPORT BEACH — FarWest Savings said Tuesday that it lost $22.9 million in the third quarter because new federal rules required the thrift to revalue its junk bond portfolio.
As a result, the thrift will not be able to meet two of the three new S&L; capital requirements that take effect Dec. 7, FarWest’s chief financial officer said.
FarWest is a subsidiary of FarWest Financial Corp., controlled by the billionaire Belzberg brothers of Vancouver, Canada.
The $22.9-million loss contrasts with a third-quarter profit of $1.5 million last year. For the first nine months, FarWest reported a $6.6-million loss, contrasted with a $6.3-million profit a year ago.
In its recent overhaul of rules regulating the thrift industry, Congress required that all junk bond investments be carried on an S&L;’s books at current market values rather than at the purchase price.
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