WASHINGTON - The Office of Thrift Supervision has cautioned thrifts to do their homework before making high-risk investments.

Deputy Director Richard M. Riccobono issued an advisory letter Monday after the agency noticed in exams that some thrifts were investing in certain risky securities that might not meet the agency's underwriting standards.

Regulators are concerned that some thrifts are not appropriately analyzing some of the securities they are buying, and are relying too heavily on outside analyses.

If they continue to buy these securities, the OTS may force the thrifts to sell them, Mr. Riccobono wrote.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.