Collective Bancorp, a $4.9 billion-asset thrift based in Egg Harbor City, N.J., said it plans to file with federal regulators to switch from a savings to a commercial bank charter, the company's chief executive said.
The company expects to file the application with the Federal Deposit Insurance Corp., Federal Reserve, and Office of the Comptroller of the Currency within one month.
The company will join a growing number of savings institutions that have filed for a charter change in response to the FDIC's expected 82% cut in the premiums paid by commercial banks.
The cut, the topic of intense political debate in Washington, would place thrifts insured by the Savings Association Insurance Fund at a competitive disadvantage to banks and the thrifts insured by the Bank Insurance Fund.
Collective would join such larger thrifts as Great Western Financial Corp., H.F. Ahmanson & Co., and TCF Financial Corp. in seeking a charter change.
Collective said if the FDIC makes the entire cut and the charter change is approved swiftly, the company would save $6 million annually or 29 cents per share, representing about 10% of 1994 earnings.
Collective has $3.1 billion in deposits.
One of Collective's main thrift competitors in New Jersey, Bankers Corp., is already insured through the bank fund. And the other significant state thrift, Sovereign Bancorp, said it plans to shift its deposits into a BIF-insured bank it recently acquired.
"We have become much more like a commercial bank anyway," said Thomas H. Hamilton, Collective's chief executive officer and chairman, explaining the impending filing.
The bank had few options because the premium cut would place it at a severe disadvantage to banks, he said. The company rejected buying a BIF- insured company solely to transfer deposits, Mr. Hamilton added.
While some thrifts have already moved to avoid paying a higher premium than banks, other companies have yet to unveil their strategies.
For example, Standard Federal Bank in Troy, Mich., is mulling whether to buy a BIF-insured bank or switch charters.
