WASHINGTON -- The Office of Thrift Supervision placed Citadel Federal Savings Bank of Charleston, S.C., in receivership and chartered a new federal mutual institution to take its place.

The new institution, Citadel Federal Savings and Loan Association, assumed certain assets and liabilities of the old thrift and operates in conservatorship under the Resolution Trust Corp.

More than one-fourth of the thrift's $41 million in assets were delinquent loans or repossessed real estate, the result of poor underwriting by a previous management, the OTS said. Recent reductions in nonperforming loans failed to offset the need to increase loss reserves, and recovery without government aid was seen as unlikely.

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