NEW YORK- Many recently converted thrift companies' stocks surged Wednesday on market speculation that the Office of Thrift Supervision would relax its rules on stock repurchases for thrifts that recently have gone public.
The agency is planning to let recently converted thrifts buy back their shares more aggressively, said Mark Fitzgibbon, an analyst at Sandler O'Neill in New York, citing unnamed sources. In the past recently converted thrifts could only buy back 25% of their shares within the first three years of conversion. A draft of the proposal is likely to be made public within a few weeks, Mr. Fitzgibbon said.
Paul Lockwood, a spokesman for the OTS, said that the "proposed rule is currently making its way through the review process at the agency."
OTS rules are subject to public comment, but Mr. Fitzgibbon said that the proposed rule would have "almost no opposition."
Recently converted thrifts such as Bay Street Bancorp, First Kansas Financial Corp., and Oregon Trail Financial Corp. were among the biggest gainers in Wednesday trading.
