FCA to Close Data Centers to Save $15 Million
Apr. 23, 1985
LOS ANGELES (AP) _ Financial Corp. of America, struggling to trim costs in the face of heavy losses, said Monday it will close its data processing centers, hire an outside firm to do the work, and save $15 million a year.
FCA's chairman and chief executive, William Popejoy, said the action is being taken after a study showed it was ''no longer prudent'' to operate its own facilities.
The data processing will be done by Gesco, a subsidiary of Guarantee Savings & Loan Association of Fresno. Gesco is one of the largest data- processin g service operations specializing in the savings and loan industry.
FCA is the parent of Stockton, Calif.-based American Savings & Loan Association, the nation's largest thrift.
Popejoy, who took over late last August after the forced ouster of his predecessor, Charles Knapp, has cut wages and staff by 20 percent and pared other expenses.
For the year ended last Dec. 31, FCA posted a loss of $590.5 million, primarily because of massive writeoffs on troubled loans and real estate the company acquired during Knapp's tenure.
FCA's first quarter ended March 31, and its financial statement for the period is expected to be released within the next week or two.
A company spokeswoman said Monday that Popejoy wouldn't speculate on what those figures would show.
But when the company released its year-end figures, Popejoy said, ''The turnaround which began in the fourth quarter should continue to strengthen the financial base of the company and return it to profitability.' '
Popejoy has pinned the company's prospects on interest rates declining or at least remaining stable.