As a New York-area thrift prepares for one of the industry's largest public offerings of stock, depositors are clamoring for a piece of the action.

Depositors in Roslyn Bancorp have lined up to buy some $2 billion of the shares - nearly five times more than the company had expected. The $1.6 billion-asset thrift is planning to convert from mutual to stock ownership.

The drastic "oversubscription" of shares underscores rising investor interest in thrifts and raises questions about whether the planned offering was priced too low, observers said.

Thrift managements came under heavy fire in the early 1990s for setting artificially low prices on their public offerings. Managers were pocketing huge sums for themselves as the stock prices soared right after the offerings.

The Federal Deposit Insurance Corp., whose approval is required for the offering, is taking unusually long to review the deal. Well-placed sources say the agency is concerned about the heavy demand for the shares.

The FDIC faces a Jan. 12 deadline to act.

Rosyln Bancorp, based on Long Island, had been planning to raise $423.7 million by issuing shares at $10 apiece. That would rank as the thrift industry's largest conversion to public ownership, behind the $804.7 million offering of New York's GreenPoint Financial Corp. in 1994.

Right now, the thrift is not authorized to exceed the targeted $423.7 million.

Though other recent conversions have been oversubscribed, Roslyn's offering is in a league of its own, said Martin S. Friedman, a senior analyst at Friedman, Billings, Ramsey & Co. The others saw closer to two times the expected demand from depositors, he said.

He and others said Roslyn was reaping the benefits of a strong market for thrift stocks. Many of these shares have been outpacing the gains of banks stocks, which themselves are enjoying a boom.

Many observers said they were not surprised to see the runaway demand for Roslyn's shares.

"Just being located where it is makes it more visible than if it was located in, say, Kansas," said Chris Smith, an analyst at SNL Securities, Charlottesville, Va.

So far, no one is willing to bet on how the FDIC will rule. But the offering could indeed face trouble.

"Regulators don't like (when a deal is heavily oversubscribed) because they think someone is trying to pull something over on them," said one thrift analyst, who asked his name not be used when commenting on another firm's deal.

If the FDIC shoots down the deal, Roslyn conceivably could start the process over again at a higher price. But that maneuver could be so costly as to make the thrift abandon the plans altogether, said Mr. Smith.

In 1994, federal regulations were revamped to prevent mutual thrift executives from reaping enormous profits when they take their thrifts public.

The rules were prompted by sharp rises in stocks following a series of conversions. Ever since, regulators have been putting conversions under a microscope, said Bert Ely, a bank consultant in Alexandria, Va..

Among other things, regulators are probably looking at whether Roslyn's oversubscription is coming from local depositors or professional investors, Mr. Ely said.

Mark B. Cohen, vice president at Sandler O'Neil, the lead underwriter for the offering, declined to comment on the FDIC review, saying he did not want to add to speculation. A spokesman for Roslyn Savings confirmed that the review was taking longer than expected but declined to comment further.

If the FDIC does not approve the conversion and the offering is reappraised and resubscribed, it could raise the appraisal threshold for other thrift conversions, some observers said.

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