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OFFICE OF THE COMPTROLLER OF THE CURRENCY PLACES UNITED BANK, N.A., IN RECEIVERSHIP

 WASHINGTON, March 18 /PRNewswire/ -- At 4 p.m. EST today, the Office of the Comptroller of the Currency (OCC) appointed the Federal Deposit Insurance Corporation (FDIC) as receiver of United Bank, National Association, Lancaster, Texas.
 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 United Bank, N.A., was critically undercapitalized -- that is, it had less than 2 percent tangible equity capital. The OCC also found that the bank was in an unsafe and unsound condition to conduct business. In light of these findings, the OCC determined that the appointment of the FDIC as receiver was necessary to protect the interests of the bank's insured depositors.
 The bank became a matter of supervisory concern in late 1990. Rapid growth and increased exposure from more speculative types of lending coupled with weak loan administration and absence of loan review resulted in decreased asset quality. Violations of law were numerous. The board signed a Memorandum of Understanding to correct these problems on May 28, 1991. However, the bank never complied with the memorandum.
 The bank's loan portfolio continued to deteriorate during 1991, requiring the bank to set aside more capital to offset loan losses. The board of directors stipulated to an Order to Cease and Desist on Feb. 18, 1992. However, corrective efforts were not implemented, and loan losses continued to deplete capital. In addition, the bank failed to accurately reflect transactions involving the sale and repurchase of the bank building. Finally, during 1992, former Chairman of the Board Charles Floyd withdrew considerable funds from the bank in dividends and other payments which were not justified. As a result of these losses, bank capital was depleted to a level that makes it unlikely that the bank could return to viable operation.
 Floyd was temporarily suspended from the bank on Nov. 20, 1992, and a permanent removal from banking is pending. In December 1992, Floyd was indicted in U.S. District Court on several banking related charges.
 United Bank, National Association, received a national bank charter on Aug. 8, 1919. On Dec. 31, 1992, it had total assets of approximately $50 million.
 The FDIC will release additional information about the resolution of the bank.
 -0- 3/18/93
 /CONTACT: Frank Vance of the Office of the Comptroller of the Currency, 202-874-4700/


CO: Office of the Comptroller of the Currency; United Bank, National
 Association ST: Texas IN: FIN SU:


TW-DC -- DC022 -- 7636 03/18/93 16:31 EST
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Publication:PR Newswire
Date:Mar 18, 1993
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