Investors Bancorp Takes Over Whittier Thrift & Loan Operations

The assets and operations of a Los Angeles County thrift and loan seized Friday by federal regulators have been acquired by Investors Bancorp of Orange, a holding company for the 11-office Investors Thrift & Loan.

Under the deal approved Friday by a Superior Court judge in Santa Ana, Investors Bancorp will take over the $15 million in assets and the three offices of Whittier Thrift & Loan Assn., reopening the branches Monday under the name Liberty Thrift & Loan Assn. The acquisition doubles Investors’ presence in Southern California.

Whittier Thrift & Loan, which had one branch in Orange County, was seized by state and federal regulators Friday and declared insolvent. The Federal Deposit Insurance Corp., which three years ago began insuring thrift and loan deposits, was named receiver.

Because deposits at Whittier Thrift & Loan were federally insured, and because it was acquired by another institution, depositors will not lose any money, and the thrift and loan will continue conducting business at its three branches in Placentia, Whittier and Diamond Bar.

Murray Zoota, president of Investors Bancorp and Investors Thrift & Loan, said the acquisition doubles the number of Southern California offices for the holding company--which already operates the state’s seventh largest thrift and loan.

Investors Bancorp moved to Orange 3 1/2 years ago from Fresno, where it was founded in 1937.

Thrift and loans, often called industrial banks in other states, cropped up shortly after the Depression to service the borrowing needs of blue-collar workers who often could not qualify for loans from traditional banks and savings and loans.

They generally are limited to consumer, automobile and short-term real estate loans; and, until insurance became available from the Federal Deposit Insurance Corp. in 1984, they generally paid higher interest rates on deposits but charged higher rates on their loans than did banks and savings and loans.

Because federal insurance carries with it additional costs and reserve requirements, those thrifts that have chosen to obtain the coverage generally have lowered their interest rates on deposits.

Zoota said that Investors Thrift posted a $2-million profit in 1986. The holding company, because of additional costs not borne by the thrift, reported a consolidated profit of $1.6 million, he said.