After 13 years at the helm of FirstFed Financial Corp., Babette Heimbuch has stepped down from her posts as chief executive and chairwoman of the embattled Los Angeles savings and loan.

The 61-year-old executive, who first joined the institution in 1982 as chief financial officer, resigned on Wednesday, FirstFed announced late Friday. Her retirement will become official Dec. 31.

Heimbuch has been succeeded as chief executive by James Giraldin, who had been chief financial officer. Brian Argrett, an independent director of the institution, was named the new chairman.

FirstFed, the holding company for First Federal Bank of California, has struggled with substantial losses over the past two years as its multibillion-dollar portfolio of option adjustable-rate mortgages began to sour. The institution is the last of the country’s major option-ARM lenders still standing.

The announcement quoted Heimbuch as saying she had planned to retire sooner, but remained with the 80-year-old thrift after it ran into trouble.

“I stayed on because of the economy and the challenges that the bank has encountered,” she said. “Now, both the bank and the economy are experiencing positive trends, and I am confident that the executive team at First Federal Bank of California is well-positioned to complete our capital-raising effort.”

Heimbuch also noted that the thrift’s massive loan modification program has been showing promising results.

For reprint and licensing requests for this article, CLICK HERE.