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HOMEFED BANK ANNOUNCES ENTRY INTO ARP PROGRAM

 HOMEFED BANK ANNOUNCES ENTRY INTO ARP PROGRAM
 SAN DIEGO, April 3 /PRNewswire/ -- HomeFed Bank, Federal Savings


Bank, today announced it was informed by representatives of the Office of Thrift Supervision (OTS) that the bank's recapitalization efforts will be conducted under the accelerated resolution program (ARP).
 Numerous investors, including financial and non-financial groups, have expressed strong interest in potentially bidding on a government- assisted transaction involving HomeFed. Among these are Home Savings of America and Great Western Bank, FSB.
 The ARP is a government program to sell troubled institutions with assistance. While an acquirer is being found, daily operations at HomeFed will remain unchanged.
 At the time of sale, HomeFed Bank would be placed in a pass-through receivership which is done overnight with no disruption of banking services to depositors or borrowers. However, it is unlikely that shareholders and bondholders would retain any value in their investment in the bank.
 HomeFed was included in the ARP program because of its strong deposit franchise, qualified management and the stability the company has shown during its recent difficulties.
 "I am pleased that HomeFed will continue to conduct business activities as usual," said Thomas J. Wageman, president and chief executive officer. "HomeFed remains open, and not under government seizure. It's business as usual for our depositors, borrowers and employees alike."
 Wageman also stressed that deposits continue to remain insured by the FDIC up to their legal limits.
 OTS and the RTC sell troubled thrifts through ARP in order to avoid the deterioration in franchise value that is normally associated with a government conservatorship. HomeFed's participation in the ARP program does not eliminate the possibility of sale of the company without government assistance, although that is considered unlikely.
 As part of the program, representatives from the OTS, RTC, and potential bidders will be on site at HomeFed conducting due diligence.
 HomeFed has also been informed that its previously reported assistance application is unlikely to be pursued by the OTS.
 If clients have any questions, they should contact their local HomeFed branch or call 800-554-2626.
 Founded in 1934, HomeFed Bank has 201 branches throughout California.
 -0- 4/3/92
 /CONTACT: Monica Wiley or Sheree Zizzi of HomeFed Bank, 619-450-7885 or 619-580-8642/
 (HOME) CO: HomeFed Bank; Office of Thrift Supervision ST: California IN: FIN SU:


EH -- SD005 -- 5098 04/03/92 19:07 EST
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Publication:PR Newswire
Date:Apr 3, 1992
Words:387
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