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VISTA FEDERAL SAVINGS, RESTON, VA., IN RECEIVERSHIP; DEPOSITS INSURED

VISTA FEDERAL SAVINGS, RESTON, VA., IN RECEIVERSHIP; DEPOSITS INSURED
 WASHINGTON, Feb. 28 /PRNewswire/ -- The Office of Thrift Supervision (OTS) today placed Vista Federal Savings Bank, Reston, Va., in receivership and chartered a new federal mutual institution to take its place.
 The new institution, Vista Federal Savings Association, will assume certain assets and liabilities of the old thrift, and will operate in conservatorship under the management of the Resolution Trust Corporation.
 The receivership did not result in any interruption of Vista's day-to-day operations. The institution and its lone branch, located in Fairfax, Va., will remain open for business as usual. Holders of insured accounts are not affected by the action, which was taken by OTS to protect insured depositors and the interests of the thrift insurance fund. Deposits remain insured to the $100,000 legal limit.
 OTS initiated the action because Vista was operating in an unsafe and unsound condition in that it had insufficient capital, with no prospect of replenishment without federal assistance.
 Vista's condition is due primarily to an over-concentration of relatively high-risk commercial real estate and acquisition, development and construction (ADC) loans in a weak local real estate market. Many of the loans were poorly underwritten. Asset values were deteriorating rapidly, and loan delinquencies were high.
 Management attempted to cut costs by closing several branches and reducing staff and salaries, but losses on bad assets were insurmountable. As of Dec. 31, 1991, assets of $34.85 million, or 30.8 percent of total assets, were classified as substandard, doubtful or loss. Repossessed real estate totaled $14.2 million, or 12.6 percent of assets. The thrift had been operating under regulatory growth restrictions since July 1990.
 Net losses were $672,000 in 1990 and $9.9 million in 1991. The institution is insolvent in that it has negative tangible, core and risk-based capital.
 Vista Federal Savings Bank was a federally chartered stock institution. Shareholders will retain no interests in the new thrift.
 As of Dec. 31, 1991, Vista Federal Savings Bank reported assets of $113.2 million, liabilities of $117.3 million and tangible capital of negative $4.1 million, for a tangible capital-to-assets ratio of negative 3.6 percent.
 -0- 2/28/92
 /CONTACT: Paulette Odum or Marc Adams of the Office of Thrift Supervision, 202-906-6677/ CO: Office of Thrift Supervision; Vista Federal Savings Bank ST: Virginia IN: FIN SU:


SB -- DC010 -- 3706 02/28/92 12:11 EST
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Publication:PR Newswire
Date:Feb 28, 1992
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