Troubled UnionFed Financial Reports Another Loss
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BREA — Long-struggling UnionFed Financial Corp., a savings and loan holding company, reported another large quarterly loss and said Friday that its financial health is as low as it can go without triggering a possible takeover by regulators.
The parent of Union Federal Bank posted a loss of $8.2 million, or 30 cents a share, for its fiscal third quarter, which ended March 31. It lost $5.3 million, or 20 cents a share, for the like quarter last year.
The company, which has now lost a total of $178.8 million since 1990, attributed the continued loss again to its troubled real estate operations and the need to set aside additional loan-loss reserves.
The red ink brought its nine-month loss to $15.2 million, or 56 cents a share, compared with a loss of $16.6 million, or 90 cents a share, for the comparable period last year.
Its results left Union Federal Bank “significantly undercapitalized,” according to federal guidelines, with capital--its final reserve against losses--equal to only 2% of its assets. Should it go below that ratio, it would be deemed “critically undercapitalized” and subject to a federal takeover within 90 days.
UnionFed said it is involved in talks with potential acquirers to meet regulatory capital compliance by June 15.
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