WASHINGTON -- Depositors have withdrawn at least $800 million from HomeFed Bank in the five weeks since the Resolution Trust Corp. took control of the troubled California thrift.

John Nigra, the RTC official overseeing HomeFed's branch network, confirmed that the volume of withdrawals has been large.

While he declined to give a precise number, Mr. Nigra said the thrift currently has $8 billion in deposits. That's down 9% from $8.8 billion when the San Diego-based institution was seized on July 6.

Low Interest Rate a Factor

Historically, deposit runoffs have diminished the value of government-held institutions to potential buyers.

Mr. Nigra predicted that the outflow would continue through this month as more certificates of deposit mature, and then abate in September.

He said low interest rates are as much to blame as the fact that the institution was seized by regulators.

The RTC is pumping cash into the institution to replace the funds, borrowing the money from the Federal Financing Bank. That agency generally charges less for funds than banks and S&Ls have to pay depositors.

The RTC is rumored to have spent $50 million to $70 million in due diligence preparing HomeFed for sale. But Congress' refusal to appropriate more money has prevented the thrift-bailout agency from moving ahead with a transaction, since it might have to invest over $2.5 billion to attract buyers, according to sources. That would wipe out the RTC's remaining working capital.

Deposit Decline Downplayed

The current intention at RTC is to bundle HomeFed's deposits with its mortgage loans and two subsidiaries for sale. HomeFed's other assets would be sold separately.

Mr. Nigra downplayed the deposit decline.

"I'm not interested in causing panic among the savers," he said. "For our size and the large number of accounts maturing in the months of July and August, compounded with [the move into] RTC conservatorship, I think we've experienced what we normally would expect in an institution like this."

Slimming Regimen for Deposits

Often, the RTC wants some deposits to run off so it can shrink a failed institution. Great American Bank, another San Diego-based thrift under RTC control, had $3.4 billion in deposits on March 31, about half its size when taken over in October 1991.

"We are not aggressively competing for deposits," admitted Great American spokesman Brian Luscomb. But he said Great American's deposit loss is "as much [because of] the overall interest rate environment as it is the bank being in conservatorship."

In the case of HomeFed, however, the RTC is aggressively courting the deposit customers. It plans to continue offering a relatively generous certificate-of-deposit product that the thrift introduced last fall.

Attractive CD Offer

With a minimum $2,500 deposit, a customer can get a seven-month CD paying 4.5%. Depositors can add to the account throughout its term and the new deposits earn the interest rate that was in effect when it was opened - even if rates fall.

If rates go up, customers can get a one-time increase in the interest being paid on their account. Withdrawals are permitted at any time without a penalty.

A troubled competitor, Glendale Federal Bank, is paying 3.65% on a six-month CD with at least $10,000, according to spokeswoman Judy Cunningham.

The Glendale CD also allows customers to add to the accounts at original interest rates, but there are early-withdrawal penalities and no promise to raise interest if rates go up.

Glendale's deposits are falling, too. It lost $2.2 billion in the last 12 months, and is down to $13.7 billion.

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