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FDICIA STANDARDS WOULD CLOSE 45 CREDIT UNIONS

 FDICIA STANDARDS WOULD CLOSE 45 CREDIT UNIONS
 CORAL GABLES, Fla., Oct. 29 /PRNewswire/ -- Bauer Financial Reports,


Inc., a banking research firm, reports that the new FDICIA standards that go into effect on Dec. 19, 1992, if applied to credit unions, would force regulators to close 45 credit unions nationwide with combined assets of $2.056 billion.
 The new FDICIA standards require federal regulators to take action to resolve any bank or thrift classified "critically undercapitalized" -- with tangible capital equal to less than 2 percent of tangible assets -- within 90 days of its having reached this level. Based on June 30, 1992 financial data, as filed with federal regulators, 67 banks and thrifts with total assets of $35.9 billion fall within this category.
 "The 'Act' does not specifically include credit unions," noted Paul A. Bauer, president of the research firm, "since it only pertains to financial institutions insured by the FDIC. If it did, 45 credit unions would have to be closed.
 "FDICIA capital standards, although somewhat restrictive to regulators, are good for consumers," added Bauer. "They require regulators to take action before an institution becomes insolvent. In light of this objective, we strongly urge credit union regulators to voluntarily adopt FDICIA standards."
 Although the 45 credit unions analyzed as "critically undercapitalized" is only slightly less than the 67 "critically undercapitalized" banks & thrifts, total assets at the credit unions represent only 7 percent of the assets at the "critically undercapitalized" banks & thrifts. Asset size is a more accurate indicator of the magnitude of the problem than the number of institutions. The credit union problem is relatively small. In fact, based on our analysis of June 30, 1992 data, over 86 percent of credit unions, nationwide, are in excellent shape.
 Bauer Financial Reports, Inc., a Coral Gables, Fla. bank research firm, will inform consumers if their bank, thrift or credit union is adequately capitalized and, if not, if it is on the "critically undercapitalized" list, at no charge. Simply call Bauer's BankRater(R) toll free number, 800-388-6686, Monday through Friday, 8 a.m. to 8 p.m. Eastern time. The call and the information are free.
 -0- 10/29/92
 /NOTE TO EDITOR: Members of the press may request specifics on the institutions noted by calling Paul A. Bauer or Karen Dorway at 305-444-3125 or faxing their request to 305-441-0691.
 CONTACT: Brienne Jorgensen of Bauer Financial Reports, 800-388-6686/ CO: Bauer Financial Reports ST: Florida IN: FIN PUB SU:


AW-JB -- FLFNS1 -- 6361 10/29/92 07:34 EST
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Date:Oct 29, 1992
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