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FDIC APPOINTED AS RECEIVER OF FIRST AMERICAN CAPITAL BANK

 WASHINGTON, March 4 /PRNewswire/ -- At 7:00 p.m. (EST) today, Judith A. Walter, Senior Deputy Comptroller for Administration, Office of the Comptroller of the Currency (OCC), appointed the Federal Deposit Insurance Corporation (FDIC) as receiver of the First American Capital Bank, National Association, Laguna Beach, Calif.
 The FDIC Improvement Act of 1991 gives the OCC authority to appoint the FDIC receiver for national banks when they meet specific criteria. The OCC used this authority when it found that First American Capital Bank, NA was critically undercapitalized -- that is, it had less than 2 percent tangible equity capital. The OCC also found unsafe and unsound practices that caused insolvency, substantial dissipation of bank assets and earnings, and weakened the bank's condition. In light of these findings, Senior Deputy Comptroller Walter determined that the appointment of the FDIC as receiver was necessary to protect the interests if the bank's insured depositors.
 In January 1987, the bank entered into a formal agreement with the OCC that required the directors and management to take actions to correct the bank's problems. Although bank management initially appeared to be making progress in addressing some of the weaknesses cited in the agreement, the bank never complied with the document. Bank management began to pursue high risk growth strategies without properly evaluating the risks that could result from these activities. Examiners noted losses from these activities at subsequent examinations of the bank. These losses caused the bank's condition to deteriorate and eventually depleted all of the bank's capital.
 First American Capital Bank, NA received a national bank charter on Dec. 1, 1981. On December 31, 1992, it had total assets of approximately $28 million.
 Information about the FDIC's resolution of the bank will be released later by the FDIC.
 -0- 3/4/93
 /CONTACT: Frank Vance, Jr. of Office of the Comptroller of the Currency, 202-874-4700/


CO: Office of the Comptroller of the Currency; First American Capital
 Bank ST: District of Columbia IN: FIN SU:


TM -- NY117 -- 3231 03/04/93 19:44 EST
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Publication:PR Newswire
Date:Mar 4, 1993
Words:337
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