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DEC. 19: BANK CRISIS OR MUCH TO DO ABOUT NOTHING?

 CORAL GABLES, Fla., Dec. 16 /PRNewswire/ -- New capital guidelines for the banking industry, as incorporated in the Omnibus Banking Bill of 1991, go into effect on Dec. 19, 1992. They require regulators to classify banks and thrifts in one of five categories -- from well capitalized down to critically undercapitalized.
 As mandated by Congress, federal regulators are required to take action within 90 days and resolve within nine months thereafter any bank or thrift at the lowest "critically undercapitalized" classification -- with tangible capital of less than 2 percent of assets.
 Congress passed this requirement, as part of the Federal Deposit Insurance Corporation Improvement Act (FDICIA), in response to criticism that regulators were taking too long to take over troubled and insolvent banks and thrifts and even longer to resolve them. The passage of this single requirement -- that regulators be limited to a specific time frame in which to take action against a "critically undercapitalized" bank -- has generated a range of predictions. Not surprisingly, "prophets of doom" have forecast a Dec. 19 "Bank Holiday" with predictions of hundreds of failures.
 Based on June 30, 1992 data, Bauer Financial Reports identified 32 commercial banks, five savings banks and 30 savings and loans as "critically undercapitalized." Seven of the commercial banks, four of the five savings banks and seven S&Ls have already been taken over by regulators -- prior to the Dec. 19 deadline. That leaves 25 commercial banks, one savings bank and 23 S&Ls on the list. Because of strong earnings and infusions of new capital, we anticipate few additions to the original list.
 In addition, some of the critical group were close to meeting the 2 percent requirement on June 30, 1992 and will probably do so as of Dec. 19. Consequently, our estimate of the "critically undercapitalized" as of Dec. 19 is 20 banks and 18 S&Ls and our description of Dec. 19 would best be a "non event".
 Members of the press may request specific details on the list of "critically undercapitalized" banks and thrifts and those since resolved by calling 305-444-3125; or FAX request to 305-441-0691.
 Bauer Financial Reports, Inc. is a Coral Gables, Fla. bank research and rating firm.
 Consumers can learn if their bank or thrift meets federal capital requirements and, if not, if it is on the "critically undercapitalized" list, without charge, by calling Bauer's BankRater(R) toll free number, 800-388-6686, Monday through Friday, 8 a.m. to 10 p.m., and Saturdays 9 a.m. to 5 p.m., Eastern time. The call and the information are free. Additional financial data on your bank, including the star rating, is free for sponsor banks and costs $10 for the first and $2 for each additional non-sponsor bank.
 -0- 12/16/92
 /CONTACT: Brienne Jorgensen of Bauer Financial Reports, 305-444-3125; or FAX, 305-441-0691/


CO: Bauer Financial Reports ST: Florida IN: FIN SU:

JB-JJ -- FLFNS1 -- 7523 12/16/92 07:33 EST
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Date:Dec 16, 1992
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