Lacking Cash, RTC Delays Big S&L Sales
WASHINGTON -- The Resolution Trust Corp., strapped for cash, has taken 14 thrifts with at least $1 billion of assets each off the selling block.
Also taken off the market are numerous smaller institutions - the RTC said it had not determined the exact number - from its portfolio of 97 institutions with $58 billion in total assets.
Among those no longer being marketed are Amerifirst Federal Savings in Miami, with $2.7 billion in assets; Home Savings of Kansas City, Mo., with $2.6 billion; and Far West Savings and Loan Association in Newport Beach, Calif., with $2.6 billion in assets.
The 14 larger institutions hold 70% of the assets in RTC thrift conservatorships.
Waiting for Congress
The thrift-bailout agency will not have the money it needs to complete the deals until Congress provides additional funding, according to William Roelle, the RTC's deputy executive director.
A bill to provide $80 billion for the 1992 fiscal year, which began Oct. 1, is apparently far from gaining congressional approval.
In the past, similar delays in disposing of failed thrifts and their assets have added millions of dollars to the cost of the bailout and, consequently, to the federal budget deficit.
Mr. Roelle said the RTC is down to its last $5 billion - enough to keep the agency open, but not to consummate sales.
"We don't want to start [transactions] we can't finish," Mr. Roelle said.
Reform Bill Poses Problem
Congress adjourned last year without passing a bill to fund the RTC, forcing the agency to postpone thrift sales. Most of $30 billion allocated last April has been spent, and Congress has been too preoccupied with the banking bill to appropriate new money.
A House Banking subcommittee approved $80 billion in new funds last week, but the full committee still must act.
A spokesman said the committee will not consider the bill, which includes a controversial pay-as-you-go funding requirement, until after action is completed on the broad banking reform bill. And that is not expected before the end of this month.
The Senate Banking Committee has not begun work on the bill and has nothing scheduled.
In addition to the 97 thrifts currently in its hands, the RTC expects to take over another 140.