Las Vegas Real Estate News: U.S. Thrifts Turn $1.8B Profit Despite Mounting Foreclosures

DSnews.com,
May 25, 2010 – The U.S. Office of Thrift Supervision posted profits amounting
to $1.82 billion for the first quarter of 2010. Data indicated that the thrifts
are generally stabilizing despite incidents of delinquent loans and
still-rising foreclosures, particularly for Las Vegas homes. The U.S. thrift industry is composed of savings
and loan institutions that focus on taking deposits and home mortgages.
According to the law, they are required to have at least 65% of their lending
in mortgage and other loans.

For the first quarter of 2010, they posted
positive earnings amounting to $442 million, in contrast to the more than $1.6
billion losses in the first quarter of 2009. It is the third subsequent quarter
that the industry has posted profits.

“Mortgages on one- to four-family
properties comprise approximately 65 percent of the industry’s current troubled
assets, with an additional 27 percent made up of commercial real estate loans,
and 8 percent in nonmortgage loans. In contrast, commercial real estate loans
comprised the majority, or 68 percent, of thrift troubled assets at the end of
1990, while one- to four-family mortgages made up 23 percent.” (Quoted from: www.dsnews.com)

The industry’s troubled that the portions that were slightly down by 3.29% in the first quarter is similar
to the 1990-1991 periods.  The real
estate industry is improving but it’s not yet out of the foreclosure crisis
that it is experiencing. And until America returns to full employment and more
families are financially secure again, the thrift industry will continue to
face major challenges, especially in Las Vegas homes, since Nevada currently has the nation’s highest foreclosure
rate.

Though coming down from very high levels in 2008, the provisions set aside by thrifts to cover potential loan losses remained high during the first quarter. The demand for loss provision is largely dependent on trends in employment, home prices and commercial real estate markets.

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