The Los Angeles Times from Los Angeles, California • 73

BUSIN Go0 Angeles (Times Saturday, December 1, 1984 CCtPart IV Selected Interest Rates Averages of daily rates ended Thursday, in percent. ,14 Textron Makes Offer for Avco That Could Be Worth $1.3 Billion i Trade Deficit Climbs Past $100 Billion Shortfall in October Puts Total at Highest Level Ever Federal Funds Rata Discount Rat May June July Aug. Sept. Source: FdralResrv9 Bank. St.

Louis 9 Taggart to Resign Post as Commissioner By BILL SING, Times Staff Writer Textron a Providence, R.I.-based conglomerate that recently fought off a hostile takeover bid, said Friday that it has proposed to acquire Avco Corp. in a deal that could be worth $1.3 billion. The $47-a-share cash offer is the third takeover bid in four months for Avco, a Greenwich, financial-services and aerospace firm whose stock price is undervalued in light of its strong earnings potential, analysts said. Avco said its investment banker, Kidder Peabody would study the bid along with its attorneys and directors, but provided little clue as whether they would accept or reject the offer. The offer, if accepted, would combine two companies with interests in financial services and aerospace and revenue of about $3 billion each.

Textron makes aircraft parts in Orange County. It also produces Bell helicopters and has venture-capital and equipment -financing operations. Avco is the parent of Newport Beach-based Avco Financial Services and makes aircraft engines. Oppose Jacobs Bid If accepted, the offer could be another coup for Minneapolis financier Irwin L. Jacobs, who leads an investor group that currently owns 12.3 of Avco and has hinted that it may launch its own takeover attempt.

Jacobs, known for selling stakes in undervalued companies at a profit, could earn as much as $15 million if he sells his Avco shares to Textron. Avco said it would oppose any takeover bid from Jacobs, so it might accept a bid from Textron as way of thwarting the controversial financier. Jacobs could not be reached for comment. Jacobs, who paid between $35 and $41 per share for his stake in Avco, had said he would offer a premium above Avco's current book value of $44.19 if he mounts a takeover bid. On the New York Stock Exchange, Avco and Textron were the first and second most-actively traded issues, respectively.

Avco stock rose $5,625 to close at $47 as 4.43 million shares were traded. Textron shares fell $1,125 to close at $33,625 on turnover of 1.36 million shares. Based on Avco's 23 million outstanding shares, the deal would be worth just under $1.1 billion. However, Avco would have about 28 million shares if all options and convertible securities were exercised, thus giving the deal a potential value of $1.3 billion. Approached Last July News of Textron's offer comes about a month after it defeated a takeover offer from Chicago Pacific Corp.

The Illinois holding company agreed not to pursue its bid for two years without the consent of Textron's directors. Textron first approached Avco about a possible merger last July and has discussed it again "on a number of occasions," Textron Chairman Robert P. Straetz and President B. F. Dolan said in a letter to Avco Chairman and Chief Executive Robert P.

Bauman. The letter said financing for the deal is already available under existing credit lines. The Textron officials would not detail their plans for Avco's businesses but did say that Textron would "assure the continuity" of Avco's senior management and that some Avco directors would be expected to become directors of the combined enterprise. WASHINGTON GD-The nation suffered a $9.2 -billion foreign trade deficit in October, the government said Friday, pushing the yearly total past $100 billion for the first time ever with two months left to add to the unwelcome record. Commerce Secretary Malcolm Baldrige, blaming the robust strength of the U.S.

dollar, said the deficit for all of 1984 still appeared headed for a $130-billion total that would nearly double the previous one-year record. And both he and private economists predicted even worse figures next year. In October, the Commerce Department report said, U.S. companies' exports rose slightly, while imports from abroad declined. Americans actually imported more oil than in September.

But there was a big drop in imports of cars, clothing and other manufactured goods an expected development at a time when the U.S. economy was slowing drastically and consumers and businesses were buying less from all sources. The October deficit was down from September's $12.6 billion, which was the second-highest on record to the level in July. David Ernst, senior economist at Evans Economics in Washington, said the decline was small comfort. "It's sort of funny that $9.2 billion is viewed as good news these days," he said, a reference to the fact that such a total would have been a record for any one month in previous years.

Economic expansion has indeed slowed drastically in recent months, with a resulting reduction in the amount of consumer goods and business machinery that Americans are willing, or able, to buy from overseas as well as from U.S. companies. By all accounts, the main reason for this year's soaring deficit in merchandise trade is the high value of the U.S. dollar in relation to most other nations' currencies, a situation that makes foreign goods cheaper for Americans to import and American goods more expensive for foreigners to buy. Carter Quits as Chairman of Oak Industries By JOHN O'DELL, Times Staff Writer California Savings Loan Commissioner Lawrence W.

Taggart resigned Friday, halfway through his four-year term, to head a new financial consulting firm in San Diego. Taggart's resignation, widely rumored in state circles for more than two weeks, was announced in the afternoon by Gov. George Deukmejian, who said Taggart, a former executive, will leave office Jan. 1. Taggart, 42, an advocate of expanded business and investment powers for often has clashed with Federal Home Loan Bank Board Chairman Edwin J.

Gray over the degree of freedom that should be granted. Gray believes tight government regulation of growth and investment powers is needed to restore the financial health of the nation's Some industry sources said the tension between the two regulators was a factor in Taggart's resignation, a contention Taggart denied. "Keeping the bank board at bay would be the one thing that would keep me on the job," he said Friday. In a telephone interview, Taggart, a San Diego County resident since 1947, said the major factor in his resignation was his desire to spend more time with his family. He has been commuting to his Rancho Santa Fe home on weekends for nearly two years.

"I have two sons, 15 and 13, and I've missed a couple of years of their life," he said. Taggart said he will become president of TCS Consulting a subsidiary of TCS Financial when he leaves office. The new job, Markets at a Glance Mazda to Build Car Plant at Ford Site in Michigan Corporate AAA nj iThr, 13 Prime Rate 11 10 Aug. Sept. Oct.

Nov. Los Angeles Times Regulations to Control Growth Asked Federal Proposals Would Tighten Net-Worth Rules By TOM FURLONG, Times Staff Wrfter Federal savings regulators proposed a set of far-reaching rules Friday in an effort to control rapid growth of large savings and loan associations through tougher requirements on net worth. The proposals were drafted by the Federal Home Loan Bank Board staff and will be considered for adoption at the end of a 30-day comment period, an agency spokesman said. The FHLBB is the primary regulator of the nation's savings and loans. However, the growth-limiting parts of the proposal do not apply to that have liabilities of less than $100 million and that are growing at less than 15 a year, industry experts said.

About half the 200 in California have liabilities of less than $100 million. The proposal generally says that the faster an liability grows, the more it must bolster its net worth. It includes a tougher formula for calculating regulatory net-worth minimums. (In parlance, deposits are liabilities, loans are assets and net worth is assets minus liabilities. Changes Believed Necessary The proposals are expected to receive close scrutiny in an industry where an estimated 60 of the already fail to meet minimum net-worth standards.

"We expect a lot of moaning and groaning" during the comment period, said one regulatory official. But regulators believe that the changes are necessary to ensure the industry's long-term financial health. "The regulations provide the basis for stabilizing growth, which should bolster public confidence in the savings and loan industry," a FHLBB spokesman said. The proposal comes just three months after regulators helped force a change in management at Los Angeles -based Financial Corp. of America, whose deposit growth was averaging a phenomenal $1-billion-a-month earlier this year.

FHLBB Chairman Edwin J. Gray has filled his recent public appearances with warnings about fast growth being a danger to the industry's insurance fund. One key part of the proposal would force an institution to increase its net worth whenever its liabilities increase. How much depends on whether liabilities grow Please see GROWTH, Page 2 Occidental Shifts Merszei to N.Y. Occidental Petroleum Corp.

said Friday that Vice Chairman Zoltan Merszei will relocate to New York from Los Angeles to give the company a greater representation on the East Coast. Merszei served as president of Occidental for a year until he was replaced by A. Robert Abboud in 1980. Abboud recently lost the No. 2 job at the Los Angeles-based oil company to Ray Irani.

Merszei joined Occidental in 1979 after serving as chairman of Dow Chemical Co. Occidental Chairman Armand Hammer said having Merszei in New York "will allow us to make better use of his broad business experience and contacts." He said Merszei will continue to focus on developing new business ventures for Occidental. 13 Bank 12 -WSO-tiey Oct. Nov. May June Lawrence W.

Taggart he said, "will give me the opportunity to work for the industry in much the same capacity, only from the private sector." Taggart formerly was senior vice president of Great American First Savings Bank in San Diego. Industry sources said Taggart's resignation was likely to set off a battle for the top spot betwee Taggart's chief deputy, Regan Kel-ley, and Dana Reed, top aide to Kirk West, director of the state Business, Transportation and Housing Agency. The Department of Savings and Loan is part of that agency. Taggart was appointed commissioner on Feb. 25, 1983.

The department is responsible for regulating and examining all state-chartered savings institutions, now numbering 153. Times San Diego County Business Editor Bill Ritter also contributed to this article. Friday, Nov. 30, 1984 tors in particular are limiting their involvement in stocks until those developments take clearer shape, they said. Stocks again failed to receive help from the bond market, where prices of long-term Treasury issues fell point, or $5 for each $1,000 in face value.

Among the blue chips, International Business Machines fell to 121, General Electric slipped V6 to 55, Westinghouse lost V4 to 25V6 and Exxon rose to 43V4. International Harvester fell to a block crossed at7V. In the secondary market for Treasury bonds, prices of short-term governments fell 632 point, intermediate maturities fell between 1032 point and 1532 point and long-term issues were down 1432 point, according to the investment firm of Salomon Bros. Inc. Among tax-exempt municipal bonds, general obligations and revenue bonds were unchanged.

Trading was light to moderate. The federal funds rate, the interest on overnight loans between banks, traded at 9, up from 8.75 late Thursday. p. July By SAM JAMESON, Times Staff TOKYO-Ending months of speculation about its plans, Mazda Motor Corp. said Friday that it will build a $450-million factory capable of producing 240,000 cars a year on the site of an idle Ford Motor Co.

plant at Flat Rock, Mich. The plant will employ 3,500 workers, who most likely will be members of the United Auto Workers, Mazda said. A new company wholly owned by Mazda will construct the plant beginning next spring, with production scheduled to start in the autumn of 1987, Kazuhiko Hoshino, Writer a senior managing director of the Hiroshima-based company, said at a press conference here. In Hiroshima, Kenichi Yamamo-to, who was named president of Mazda simultaneously with the firm's decision to invest in the United States, said Mazda is negotiating with Ford to sell a yet-undetermined portion of the production of the new plant through Ford's sales network. Ford owns 25 of Mazda's stock.

Hoshino predicted that some of the plant's production Please see MAZDA, Page 2 Key Rates quoted by leading California financial institutions. In percent as of Nov. 30, 1984 DOW 30 NYSE AMEX NASDAQ WILSHIRE Dow Drops 4.52 to Finish Week With 31-Point Loss By BILL RITTER, San Diego County Business Editor SAN DIEGO-Everitt A. Carter, who guided Oak Industries Inc. during its meteoric rise and descent, abruptly resigned Friday as chairman and chief executive.

Carter, 65, informed Oak's board of his decision Thursday during the media company's annual management strategy meeting at the La Quinta Hotel, outside Palm Springs. "I just got tired of it," Carter said in an interview. "I was worn to a frazzle, and I wanted to get out while I still have my health." The company has reported losses in each of its last eight quarters and is the target of a Securities and Exchange Commission investigation as well as a class -action shareholder lawsuit alleging fraud, deceit and negligence. E. L.

McNeely, chairman of the board's executive committee, was named to replace Carter as interim chief executive until a successor can be found. McNeely was chairman and chief executive of Wickes Cos. until it filed for Chapter 11 bankruptcy protection in April, 1982. Carter, who became chairman in 1963, piloted Oak from a tiny electronics concern in Crystal Lake, 111., to a high-flying media company in Rancho Bernardo with worldwide operations. Only three years ago, Carter told shareholders that Oak's revenue could grow to $1 billion per year in this decade.

Between 1977 and 1982, Oak expanded its ON TV over the air subscription television system to five cities, developing its own media programming network and producing state-of-the-art cable-TV converters and decoders. Oak's revenue peaked in 1982 at $545.7 million, and earnings topped out in 1981 at $30.1 million. The company's stock hit a high of $38 about three years ago. The stock closed Friday on the New York Stock Exchange at $2,625. Please see CARTER, Page 2 Deposits MMA: Rates paid on money-market deposit accounts with a balance of $2,500 and allowing six fund transfers per month.

CD: Annual yield on certificate of deposit account balance of $2,500 with 2-year term. Loans Mortgage: Intro Introductory rate for a 30-year, $150,000 adjustable mortgage; terms, appraisal fees and loan origination charges vary. APR Annual percentage rate is based upon a designated index; the index is assumed to remain constant. 2nd: Second trust deed loan of $20,000 fully amortized over 15 years, adjustable rate fixed rate). Auto loan: Interest rate for an $8,000, 48-month, new car loan fixed rate).

Card: Annual percentage rate charged on credit balance. Institutions charge an annual fee of $10 to $20. Deposits Loans Mortgage Banks MMA CD Intro. APR 2nd Auto Card Bank of America 8.50 10,50 12.75 13.03 13.50 15.50 19.80 California First Bank 8.50 10.76 11.50 13.757 12.00 15.00 19.80 Crocker Bank 8.50 10.75 11.00 12.62 12.75 13.76 21.00 First Interstate 8.25 10.62 11.75 13.376 15.00 14.75 21.00 Lloyds BankCalifornia 8.25 10.26 NA NA 13.25 14.60 20.00 Security Pacific 8.25 10.60 11.25 13.75 13.50 15.00 20.40 Sumitomo Bank 8.50 10.20 12.50 12.780 NA 14.00 19.80 Wells Fargo 8.50 10.25 11.50 11.52 11.50 14.75 20.00 American Savings 9.00 10.516 11.50 12.686 NA NA 18,00 Beverly Hills Savings 8.85 11.29 11.125 13.750 13.125 NA NA California Federal 8.35 11.00 9.90 11.55 12.25 14.75 19.00 Central Savings 8.80 11.55 NA NA NA NA 19.80 Citicorp Savings 8.50 11.20 11.50 12.12 14.25 NA NA Coast Savings 8.50 10.65 11.50 13.30 12.75 NA 20.90 Columbia Savings 8,60 10.99 10.626 11.771 12.67 NA 20.90 Downey Savings 8.60 10.74 10.75 13.366 13.25 12.60 20.90 Far West Savings 9.06 10.669 10.90 13.064 13.50 14.75 NA Fidelity Federal 8.60 11.19 10.875 13.00 11.625 NA 20.90 First Nationwide 7.900 10.381 12.00 12.70 12.25 NA 18.00 Gibraltar Savings 8.159 10.616 11.60 13.96 12,76 14.26 20.90 Glendale Federal 8.36 11.119 10.25 13.386 12.50 14.50 21.00 Great American 8.560 11.000 10.876 13.872 12.600 14.76 20.40 Great Western 8.40 10.860 11.60 13.46 13,25 NA 19.80 Home Federal Savings 8.40 11.00 11.25 13.19 12.50 TiTi 19,60 Home Savings of Amer. 8.36 10.921 11.50 13.37 NA NA 18.00 Imperial Savings 8.999 10.543 11.26 13.09 12.76 14.76 "17.00 Mercury Savings 8.609 10.960 10.626 13.700 14.260 14.000 20.900 Sears Savings Bank 8.60 10.79 10.90 12.67 14.25 14.60 NA Valley Federal 8.90 11.190 11.25 13.88 14.039 14.289 18.00 World Savings 8.46 11.03 11.60 13.687 12.376 14.65 19,80 From Times Wire Services NEW YORK-Stocks suffered their third consecutive loss Friday and the Dow Jones industrial average closed its worst week since mid-September.

The bulls might have been encouraged that prices failed to worsen after mid-session, and even narrowed a bit in the closing hour. But for the week the market managed only one advance. Computer, airline and mining issues paced the losers Friday, and 46 stocks hit new 52-week lows on the New York Stock Exchange. The Dow Jones average of 30 industrials fell 4.52 to 1,188.94, giving it a weekly loss of 31.36 the measure's worst weekly performance since it fell 35.78 in the week ended Sept. 21.

Big Board volume remained slack, totaling 77.58 million shares, against 75.86 million Thursday. The sluggish volume this week signaled that investors are confused about the severity of the economic slowdown, the ramifications of the Treasury Department's tax-change plans and President Reagan's tentative proposal to freeze federal spending, some analysts said. As a result, institutional inves.