Things have never looked darker for First Executive, the Los Angeles-based insurer built on junk bonds. The company, which has just over $49 billion of life insurance in force, reported on Apr. 1 that it lost $466 million in the fourth quarter of 1990 as its junk portfolio crumbled and defaults mounted. And First Exec's auditors, Price Waterhouse, refused to express an opinion on the company's financial statements because, the insurer disclosed, "they believe there is substantial doubt about the company's ability to continue as a going concern."
Chairman Fred Carr insists the junk market is improving and says the company is discussing a restructuring with "a major European financial institution." But the insurer's problems may be too much for any potential rescuer.