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SOCIETY FOR SAVINGS REPORTS 1991 RESULTS, ADDITIONS TO RESERVES, BRANCH CLOSINGS, AND THE RESTRUCTURING OF BENEFITS PLAN; OUTLINES CONSENT ORDER

SOCIETY FOR SAVINGS REPORTS 1991 RESULTS, ADDITIONS TO RESERVES, BRANCH CLOSINGS, AND THE RESTRUCTURING OF BENEFITS PLAN; OUTLINES CONSENT ORDER
 HARTFORD, Conn., Jan. 27 /PRNewswire/ -- Society for Savings Bancorp, Inc. (NASDAQ: SOCS) ("Society" or "Bancorp") parent of Society for Savings ("the bank") today announced a consolidated net loss for the year ended Dec. 31, 1991, of $64.5 million, or $5.42 per share, compared to a consolidated net loss of $52.4 million, or $4.40 per share, for the year ended Dec. 31, 1990. For the quarter ended Dec. 31, 1991, Society reported a consolidated net loss of $58.9 million, or $4.95 per share, compared to a loss of $54.8 million, or $4.60 per share, for the same period a year earlier. Included in the fourth quarter results are a $16.5 million charge to earnings related to 1992 branch closings, writeoffs of selected data processing activities being considered for outside servicing, excess administrative office space, and a writedown of the carrying value on Society for Saving's undeveloped downtown Hartford building site.
 Society also said that there were $52.2 million in provisions for possible loan losses and losses on real estate owned in the fourth quarter. These charges were largely taken as a result of changes in the bank's methods for evaluating foreclosed commercial properties, in-substance foreclosures, and its allowance for loan losses. The new approach is based on internal review procedures which have taken into consideration the effects of the continuing recession on the banks' loan portfolio and further declines, beyond current appraisals, in both the loan portfolio and owned real estate category.
 Lawrence Connell, who was named president and chief executive officer of Society in Novemer 1991, said the corporation is making some tough moves very quickly in order to restore profitability. "There's no easy method or magic formula for putting an institution back on track. Society simply must reduce costs, achieve profit margins on its core banking business, and attain greater market share -- and we must do all these things as soon as possible. Our objective is to re-establish Socity for Savings as a leading "Community Bank" in our chosen markets. This will be accomplished by withdrawing from certain commercial lending activity, returning to a more retail-oriented customer base, increasing residential mortgage lending statewide, and emphasizing fee income products, among other things."
 Three major decisions announced today by Connell are the closing of certain branches, consideration of the outsourcing of data processing operations, and the restructuring of the company's benefit plan.
 Fourteen branch offices will close on April 24, 1992. Of that total, eight are in Fairfield County, three are in New Haven County, two are in Hartford County, and one is in Middlesex County. The writeoff of lease, furniture, and equipment cost associated with these branch closings is $4.3 million, of which $2.1 million was charged against the reserves previously established for these closings. Approximately 55 to 60 employees will be affected. "The closing of branches mainly represents withdrawal from markets where we do not have a significant share and follows a nationwide trend among banks toward reducing expenses," Connell said.
 Society officials are negotiating the transfer of internal data processing and other operations to a service bureau on a contract basis. The bank wrote off $8.4 million of data processing equipment and development costs in anticipation of outsourcing this operation. This outsourcing could affect another 63 employees. "We have begun the negotiating process for a choice of vendors. This move will save us significant operating expenses in the future," Connell stated.
 Today's announcement also included the establishment of a new retirement program for bank employees. Last month the bank had moved to cease further accruals under its existing pension program. The prior action had been predicated on the need to avoid 1993 contributions, as a means of alleviating the bank's financial difficulties. However, changes in the financial assumptions underlying the earlier decision, including a significant decline in interest rates in late December, precipitated further analysis by the bank's actuarial and investment advisors. Based on such discussions, it was determined that benefit accruals under the new program can be made without the requirement of corporate contributions during 1992 through 1994. The new program incorporates the existing pension plan; however, to control expenses the plan is being modified to eliminate the cost-of-living adjustment. The bank will be continuing its previously announced program to offer early retirement benefits to certain eligible employees through March 31, 1992.
 Commenting on these decisions, Connell said, "By moving quickly to reduce expenses as well as aggressively reserving on problem assets, Society will be positioned to return to its status as a leading community bank. Our business strategy includes continued asset shrinkage, a simplified product mix, a lessening of commercial real estate exposure, and reductions in the levels of non-performing assets. During 1991 a great deal of effort was spent on reducing risks and shrinking assets. The company decreased assets by $840 million, consisting of such higher risk assets as mobile home loans, out-of-territory boat loans, home equity loans, and commercial real estate loans. We also sold mortgage servicing rights at a significant gain. These actions contributed to the successful completion of much of the bank's restructuring program. Essentially, we regard 1992 as a year in which significant continued streamlining will take place. We will spend a good part of this year building a strong, community-based institution which can again be profitable on a core-earnings basis."
 Society for Savings also announced that it has consented to a cease and desist order by the FDIC and that Bancorp has executed a written agreement with the Federal Reserve Bank of Boston.
 Society's Board Chairman, Rudolph P. Arnold, said "The fact that Society hired Lawrence Connell as president and chief executive officer has been a critical step toward meeting our regulators' concerns."
 Under the consent order with the FDIC, in which the Connecticut Department of Banking has concurred, Society has agreed to take a number of corrective actions, including the following: performing a management assessment; attaining a 5.0 percent leverage capital ratio within six months and developing a written plan for meeting the capital level requirements; developing a plan for dealing with loans classified as "substandard" or "doubtful;" revising the bank's loan, funds management, and investment policies; developing written profit and business plans; and obtaining regulatory permission before declaring or paying dividends. The bank is also required under the order to have made at least $54 million in total provisions to its loan loss allowance since March 31, 1991; the bank's provisions during the latter three quarters of 1991 have more than fulfilled this requirement. Connell said that several of the improvements required by the order are already underway and that compliance with the others will be achieved within regulator-approved timeframes. The written agreement with the Federal Reserve Bank requires Bancorp to develop a capital plan and to obtain prior regulatory approval for the payment of dividends, the incurrence of debt, and the making of significant expenditures.
 Additions to the loan loss allowance and the previously described writeoffs caused Society's capital levels to fall below certain regualtory capital benchmarks at Dec. 31, 1991. On that date the leverage capital ratios were 4.21 percent for the bank and 4.65 percent for Bancorp. Capital plans detailing each corporation's program to achieve a 5.0 percent leverage capital ratio will be submitted to the Federal Deposit Insurance Corporation and the Federal Reserve Bank for approval. Society's risk-based capital ratios of 8.45 percent for the bank and 9.09 percent for Bancorp at Dec. 31, 1991 were however, above the regulatory requirements.
 Included in the company's operating results is Fidelity Acceptance Corporation ("FAC"), a subsidiary of the bank. Fidelity earned an after tax profit of $6.5 million for the fourth quarter ended Dec. 31, 1991, up $2.0 million from the fourth quarter 1990 net income of $4.5 million. For the 12 months ended Dec. 31, 1991, FAC's after-tax earnings were $21.6 million, compared to $16.3 million for the same period one year ago.
 Consolidated net interest income for the year ended Dec. 31, 1991, was $104.7 million and $23.5 million for the fourth quarter of the year, compared to $114.1 million and $27.0 million for the prior year periods respectively. Total assets were $3.0 billion at Dec. 31, 1991, down from the $3.8 billion at Dec. 31, 1990. Total deposits were $2.3 billion at year-end 1991, compared to $2.7 billion at Dec. 31, 1990. Shareholders' equity decreased $64.6 million, from $214.0 million at Dec. 31, 1990 to $149.4 million. The ratio of equity to assets was 5.00 percent at Dec. 31, 1991, compared to 5.59 percent a year earlier.
 At Dec. 31, 1991, Society no longer classified any assets as "held for sale" under the 1990 Restructuring Plan. Of the $1.6 billion of assets originally identified for sale in November 1990, $222.2 million remained unsold as of the year-end and were transferred back to their appropriate loan categories or to "real estate owmed" at the lower of cost or fair value. These remaining assets primarily consist of performing commercial real estate loans, which are now going to be retained and non-performing commercial real estate loans and foreclosed properties, which are no longer being considered for bulk sale.
 Non-performing assets were $173.8 million at Dec. 31, 1991, a decrease of $15.3 million from Dec. 31, 1990. The reduction was totally due to charge-offs. Non-performing assets were 5.81 percent of total assets and consisted of $82.9 million of non-accrual loans, $72.4 million of repossessed assets, and $18.5 million of loans delinquent more than 90 days but still accruing interest. The allowance for loan losses at Dec. 31, 1991, was $70.8 million and was equal to 70 percent of non-performing loans. In addition to the $70.8 million allowance for loan losses, a $5.2 million allowance for losses on foreclosed real estate existed at Dec. 31, 1991. The ratio of both allowances for losses to total non-performing assets was 44 percent at Dec. 31, 1991.
 SOCIETY FOR SAVINGS BANCORP, INC.
 (In thousands, except per share data)
 Three months ended 12 Months Ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 EARNINGS:
 Net income (loss) $(58,921) $(54,833) $(64,512) $(52,426)
 Tax-equivalent interest,
 fees and dividend income 77,117 107,383 350,046 453,145
 Interest expense 53,408 79,817 244,138 333,054
 Tax-equivalent net
 interest income 23,709 27,566 105,908 120,091
 Tax-equivalent adjustment 208 566 1,218 5,972
 Net interest income 23,501 27,000 104,690 114,119
 Provision for loan losses 35,176 2,567 91,190 37,169
 Net interest income after
 provision for loan loss (11,675) 24,433 13,500 76,950
 NON-INTEREST INCOME:
 Gains on securities 0 (891) 8,372 2,911
 Other 4,853 5,430 26,674 22,989
 Gain on sales of mortgage
 servicing rights 0 27 18,881 3,053
 Total 4,853 4,566 53,927 28,953
 NON-INTEREST EXPENSE:
 Staff 9,165 10,710 39,019 39,502
 Occupancy 2,689 2,987 10,992 10,912
 Equipment 1,726 1,760 6,823 6,596
 Restructuring charge --- 88,819 7,000 88,819
 Other 8,328 10,874 34,772 37,765
 Foreclosed real estate 18,359 902 22,515 6,035
 Bank premises and
 computer charges 16,519 --- 16,519 ---
 Total 56,786 116,052 137,640 189,629
 Income (loss) before
 income taxes (63,608) (87,053) (70,213) (83,726)
 Income taxes (benefit) (4,687) (32,220) (5,701) (31,300)
 Net income (loss) $(58,921) $(54,833) $(64,512)$(52,426)
 PER COMMON SHARE DATA:
 Earnings (4.95) (4.60) (5.42) (4.40)
 Dividends declared 0.000 0.15 0.075 0.60
 Book value 12.61 17.96 12.61 17.96
 Average shares
 outstanding 11,898,000 11,916,000 11,909,000 11,916,000
 End of period shares
 outstanding 11,853,000 11,916,000 11,853,000 11,916,000
 Three months ended 12 months ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 AVERAGE BALANCES-(a)
 Loans, net 1,793,113 2,735,645 2,219,146 2,777,539
 Investments, net 1,214,210 1,227,801 1,054,836 1,384,179
 Earnings assets, net 3,007,323 3,963,446 3,273,982 4,161,718
 Total assets, net 3,158,707 4,102,650 3,423,614 4,299,333
 Deposits 2,288,505 2,836,221 2,463,875 2,904,653
 Short-term debt 44,514 125,370 72,350 174,482
 Long-term debt and
 capital notes 541,527 844,331 605,571 896,507
 Interest-bearing
 liabilities 2,874,546 3,784,818 3,141,796 3,952,917
 Shareholders' equity 193,158 239,123 204,577 255,922
 ---
 Note (a)-Includes assets held for sale.
 END OF PERIOD BALANCES
 Loans, gross
 Accruing-(b) 1,666,539 1,677,430
 Nonaccruing and
 restructured-(b) 82,856 46,021
 Total loans-(b) 1,749,395 1,723,451
 Allowance for loan losses (70,823) (35,383)
 Assets held for sale --- 1,293,375
 Valuation allowance-AHFS --- (63,575)
 Total assets 2,989,043 3,828,675
 Shareholders' equity 149,412 214,050
 Tier I Capital 147,459 210,303
 Total risk-based capital 194,898 271,344
 ---
 Note (b)-Excludes assets held for sale.
 RATIOS
 Average shareholders' equity
 to average assets 6.12 pct 5.83 pct 5.98 pct 5.95 pct
 Leverage ratio
 (for the quarter) 4.65 pct 5.10 pct 4.65 pct 5.10 pct
 Risk-adjusted capital
 ratios (end of period):
 Tier I --- --- 6.87 pct 6.92 pct
 Total capital --- --- 9.09 pct 8.93 pct
 Net interest margin
 (tax equivalent basis) 3.12 pct 2.79 pct 3.19 pct 2.86 pct
 Net interest spread 2.68 pct 2.31 pct 2.78 pct 2.35 pct
 Financial Highlights
 (in thousands)
 Three months ended 12 months ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 ASSET QUALITY
 NONPERFORMING ASSETS:
 Nonaccrual loans $77,234 $136,356
 Restructured loans 0 4,682
 Foreclosed and
 repossessed assets 72,427 35,289
 Accruing loans past due
 90 days or more 18,483 12,712
 Performing
 nonperforming loans 5,622 ---
 Total nonperforming assets $173,766 $189,039
 NPAs held for sale,
 included above --- $119,584
 OTHER FINANCIAL INFORMATION:
 Net charge-offs--loans
 held for investment 16,832 16,662 55,751 35,807
 Net charge-offs to
 average loans held for
 investment (annualized) 4.01 pct 2.40 pct 3.29 pct 1.27 pct
 Net charges to
 restructuring reserve
 -- asset held for sale 21,230 25,244 70,575 25,244
 Nonperforming loans +
 OREO to loans + OREO 9.53 pct 6.80 pct
 Allowance for loan
 losses to loans
 outstanding-(c) 4.05 pct 2.05 pct
 Allowance for loan
 losses to annualized
 net charge-offs 105.19 pct 53.09 pct 127.03 pct 98.82 pct
 Valuation allowance to
 total assets held
 for sale --- 4.92 pct
 ---
 Note (c)-Excluding assets held for sale and their related valuation allowance.
 -0- 1/27/92
 /CONTACT: Albert E. Fiacre Jr., executive vice president and chief financial officer, 203-727-5420, of Society for Savings Bancorp/
 (SOCS) CO: Society for Savings Bancorp, Inc. ST: Connecticut IN: FIN SU: ERN


PB-EG -- NE013 -- 3741 01/27/92 12:23 EST
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