Year-2000 concerns have landed a pair of California community banks in regulatory hot water.

Pacific Thrift and Loan Co. in Woodland Hills and Bank of Lakewood (Calif.) have been ordered by the Federal Deposit Insurance Corp. to cease practices it says could lead to losses on Jan. 1, 2000.

In orders issued in March but released last week, the FDIC charged that the two institutions had failed "to take appropriate measures to ensure that bank information systems are year-2000 ready." They were also cited for operating without adequate supervision from their boards and management.

Pacific, with $181 million of assets, and Bank of Lakewood, with $26 million, consented to the orders without admitting or denying the charges. Officials of the two institutions did not return calls seeking comment.

In separate orders, the institutions were told to adopt and carry out new year-2000 readiness plans. Each was ordered to make status reports to the FDIC regional director and to retain managers capable of "ascertaining that the bank information systems are fully year-2000 ready and are appropriately tested."

This was the third action the FDIC has taken against Pacific Thrift and Loan in the past six months. On Nov. 23, it ordered prompt corrective action to boost capital levels. Shortly after, a cease-and-desist order was agreed to calling for the thrift to alter its management structure and internal policies.

Both of these orders remain in effect.

The agency said these institutions are the exceptions, not the rule. At the end of the first quarter, the FDIC reported that 97% of banks and thrifts were on track to make their systems ready for the millennium changeover. And the regulator said it still expects no failures.

In a separate action, the FDIC also issued a cease-and-desist order against Glen Garrett, chairman of First State Bank of Purdy, Mo. Mr. Garrett has been accused by the agency of engaging in "dishonest banking activities" that resulted in "pecuniary gain."

He was fined twice by the FDIC in the last four years.

Mr. Garrett was ordered to notify the $103 million-asset bank's board when he has an economic interest in any loan made by the bank. In agreeing to the order, he admitted no misconduct.

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