BANKING

Not to Worry: On first glance, Fullerton Savings & Loan appeared to be caught in the credit crunch.

The S&L; has a stake in a partnership that recently filed for bankruptcy protection because Bank of California would not extend $6.25 million in loans on a housing project in Norco. The partnership, Park Ridge Associates, is only 36 units away from finishing the 118-unit development.

Sounds alarming. But rest assured, says Carl Gregory, Fullerton S&L;’s chief executive. There’s nothing wrong with the project.

“The only reason the partnership is in bankruptcy is they didn’t want to finance the last phase,” he said. “It’s just a way of protecting our equity.”

The S&L; is expected to get its $3 million to $4 million back from the project, plus a share of profits, he said.

The partnership hopes to finance construction of the remaining homes with the profits from sales of those already built or under construction, Gregory said. Overall, 66 units have been sold, and nine are in escrow. The S&L;’s stake in the joint venture is less than 50%.

Federal regulators have given Fullerton Savings until 1996 to divest itself of all of its real estate investments, including three other projects. The real estate investments now make up 5.4% of Fullerton Savings’ assets.