Enstar Filing Worries S&L
MIAMI -- American Savings and Loan Association of Florida said the recent filing for bankruptcy protection by the Enstar Group, which owns 50% of the thrift, raises doubts that it can comply with its plan to increase capital.
American Savings, the largest thrift in Florida, had $4.4 billion in assets at yearend 1990 and risk-adjusted capital equal to 5.73% of assets, short of the 7.2% required. The tangible and core capital ratios were also deficient.
The thrift had filed a capital-restoration plan with the Office of Thrift Supervision on April 8. The plan assumed that American Savings would collect interest payments and other obligations of Enstar, which filed for Chapter 11 protection from creditors last Friday.
Enstar, based in Montgomery, Ala., funded a diversification in the 1980s through junk bonds. Several retailing subsidiaries entered Chapter 11 proceedings in January, including Kinder-Care Learning Centers Inc., the child-care company that was part of Enstar until it was spun off in 1989.
American Savings said it cannot predict what effect Enstar's filing will have on the OTS's review of its capital plan.