Printer Friendly

COLUMBIA BANKING, ROCHESTER, PLACED IN RECEIVERSHIP BY OTS

 COLUMBIA BANKING, ROCHESTER, PLACED IN RECEIVERSHIP BY OTS
 WASHINGTON, June 12 /PRNewswire/ -- The Office of Thrift Supervision (OTS) today placed Columbia Banking Federal Savings & Loan Association, Rochester, N.Y., in receivership and chartered a new federal mutual institution to take its place.
 The new institution, Columbia Banking 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 Columbia's day-to-day operations. The institution and its 24 branches 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.
 Columbia was being marketed through the government's Accelerated Resolution Program (ARP), designed to sell certain troubled or insolvent thrifts without subjecting them to a lengthy and more costly federal conservatorship. However, lack of congressional funding for the ARP forced regulators to take control of the institution.
 OTS initiated the action because Columbia was operating in an unsafe and unsound condition in that it had insufficient capital, with no prospect of replenishment without federal assistance.
 Columbia's condition is due primarily to losses on poorly underwritten, high-risk commercial business and real estate loans originated by former management. As of March 31, 1992, assets of $294.7 million, or 23.1 percent of total assets, were classified as substandard, doubtful or loss.
 Columbia had a net loss of $32 million for 1991. The thrift reported a net profit of $2 million for the first three months of 1992, but current management does not expect to be able to sustain earnings as more loss reserves must be set aside against Columbia's deteriorating commercial real estate portfolio. The institution is insolvent in that its liabilities exceed its assets.
 Despite its condition, Columbia was eligible for the ARP because of its strong branch network and core deposit base, which had drawn the interest of several financial institutions as potential buyers.
 "It is with great reluctance that we seize institutions like Columbia, which could have attracted a buyer and been resolved at less cost to the taxpayer," said OTS Director Timothy Ryan. "But lack of congressional funding for thrift resolutions has left us no choice. Unsafe and unsound institutions cannot continue to operate without some resolution plan underway."
 As of March 31, 1992, Columbia Banking Federal Savings & Loan Association had assets of $1.28 billion, liabilities of $1.31 billion and tangible capital of negative $36.3 million, for a tangible capital-to-assets ratio of negative 2.8 percent.
 -0- 6/12/92
 /CONTACT: William Eayre, 412-338-2578, or Marc Adams, 202-906-6677, both of the Office of Thrift Superivision/ CO: Office of Thrift Supervision; Columbia Banking Federal Savings &
 Loan Association ST: New York IN: FIN SU:


TW -- DC014 -- 9675 06/12/92 12:29 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Jun 12, 1992
Words:490
Previous Article:SHELDAHL ANNOUNCES THIRD QUARTER RESULTS
Next Article:SYMIX ANNOUNCES A NEW ENTERPRISE SOLUTION PACKAGE AND USER-BASED PRICING
Topics:


Related Articles
IRVINGTON FEDERAL SAVINGS & LOAN PLACED UNDER GOVERNMENT CONTROL
CSBS/IBAA SUE OTS ON INTERSTATE BRANCHING RULE
HOME UNITY IN RECEIVERSHIP; DEPOSITS ARE FULLY PROTECTED
OTS PLACES CALIFORNIA'S HOMEFED BANK IN RECEIVERSHIP; DEPOSITS PROTECTED
FIRST FS&LA OF RUSSELL COUNTY, ALA., PLACED IN RECEIVERSHIP BY REGULATORS
ALABAMA'S BIRMINGHAM FEDERAL IS PLACED IN RECEIVERSHIP; DEPOSITS INSURED
GOVERNMENT TAKES CONTROL OF OVERLAND PARK SAVINGS
POLIFLY SAVINGS AND LOAN UNDER GOVERNMENT OPERATION
HAWTHORNE FINANCIAL REPORTS EXECUTION OF REGULATORY AGREEMENT
OTS, FDIC take over Indymac Bank.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters