ST. CLOUD, Fla. -- FFO Financial Group Inc., which owns First Federal Savings and Loan Association of Osceola County, said the thrift would have to increase its loan-loss reserves by $3.1 million after an examination by the Office of Thrift Supervision and the Federal Deposit Insurance Corp.

Of the additional provision $1.6 million would be allocated to specific loan-loss allowances; the remainder, to general valuation allowances.

The thrift reported tangible and core capital ratios of 3.24% of applicable assets at June 30, which met minimum federal requirements, but the risk-based capital ratio of 5.76% fell short of the standard.

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