Security Pacific Net Rises; Chase, First Chicago Drop

Security Pacific Corp. said Monday that its second-quarter net income rose 6% to a record high, reflecting the strength of its primary markets.

Chase Manhattan Corp. said its second-quarter profit plunged 62% from a year earlier, partly because it raised its loan-loss provision to cover problem commercial real estate loans.

First Chicago Corp. also posted lower results, with its second-quarter earnings dropping 35% due to higher expenses and a big addition to its loan-loss reserve.

Los Angeles-based Security Pacific reported that net income for the quarter ended June 30 rose to $195.2 million from $184.5 million a year earlier. For the half year, it earned $386.6 million, up 5% from $363.88 million.

Security Pacific attributed its higher quarterly profit to strength in its primary markets, California and Washington state. Those areas have outpaced other parts of the country in economic growth, particularly the Northeast, which is served by banks such as Chase.

The company said non-interest income grew by 12% while non-interest expenses were up only 2%.

Chase, based in New York, said its quarterly income fell to $52 million from $137 million in 1989. For the first half of 1990, Chase netted $96 million, down 64% from $269 million last year.

Chase, one of the nation’s largest commercial construction lenders, said its quarterly income was hurt by its decision to raise its credit-loss provision by $75 million to $225 million.