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FIRST FEDERAL SAVINGS BANK OF PUERTO RICO ANNOUNCES CONVERSION PLANS

 SAN JUAN, Puerto Rico, June 30 /PRNewswire/ -- First Federal Savings Bank of Puerto Rico (NYSE: FBP) announced today that its Board of Directors approved the Bank's plan to convert to a state chartered commercial bank.
 The Bank will initiate the process of conversion, which involves obtaining approvals from the Office of Thrift Supervision, the Commissioner of Financial Institutions of Puerto Rico, a ruling from the Internal Revenue Service, and securing approval from the Bank's stockholders in a special stockholders meeting.
 "Today marks the beginning of the most important step First Federal will take, since it became a publicly owned institution in 1987," said Mr. Angel Alvarez Perez, President and Chief Executive Officer of First Federal. "First Federal operates in a highly competitive market, which is going through a rapid consolidation process. The competition comes principally from commercial banks who operate under a different set of rules," added Mr. Alvarez. The thrift charter limits the amount an institution can invest in commercial and consumer loans.
 In addition to the above strategic and business issues, First Federal's tax situation after the conversion will be simplified dramatically. Currently, the Bank's main tax jurisdiction is the United States, but it also has to file a return and pay taxes in Puerto Rico. Upon conversion, the Bank's main tax jurisdiction on the Puerto Rico income will only be the Puerto Rico commonwealth government.
 First Federal Savings Bank, with total assets of $1.9 billion, is the largest savings institution and the second largest locally owned banking institution in Puerto Rico. The Bank, which exceeds all regulatory capital requirements, operates 30 branches in Puerto Rico and the U.S. Virgin Islands and, through its First Florida Savings Bank subsidiary, has three offices in the greater Miami area. First Federal's primary lending focus is on providing consumer finance services (including auto loans, personal loans and credit cards) and commercial mortgages for small to mid-sized businesses.
 -0- 6/30/94
 /CONTACT: Annie Astor de Carbonell, Chief Financial Officer, First Federal Savings Bank of Puerto Rico, 809-724-1715/
 (FBP)


CO: First Federal Savings Bank of Puerto Rico ST: Florida IN: FIN SU:

SS-DP -- FL009 -- 1728 06/30/94 11:43 EDT
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Publication:PR Newswire
Date:Jun 30, 1994
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