LaFalce Would Extend Deadline On S&L Capital
WASHINGTON -- Rep. John J. LaFalce said on Wednesday that he will propose granting savings and loans a "moderate" amount of additional time to meet new capital standards.
The Democrat from Buffalo said he would seek to attach an amendment when the House Banking Committee considers legislation to fund the Resolution Trust Corp.
His proposal, which he did not describe in detail, is one of several being discussed by Congress members who believe the industry's survival depends on an extension of time to write off goodwill added to balance sheets during the 1980s.
"I firmly believe that no additional funding should be provided to the RTC unless such a change is made," Mr. LaFalce said at a hearing of the banking panel's subcommittee on general oversight and investigations. "If we do not move in this direction, we are simply maximizing the amount of taxpayer dollars that will have to be committed to this effort."
Ryan Open to Idea
Office of Thrift Supervision director T. Timothy Ryan, during a break in the subcommittee proceedings, said he has an open mind about extending the time to write off supervisory goodwill. Some Congressmen are suggesting three to five more years, he said.
"That is something we would look at if they propose it," Mr. Ryan said.
The National Association of Home Builders has pushed for an extra five years to phase in thrift capital requirements, and has organized a coalition of a dozen like-minded organizations.
The thrift industry has about $4 billion in goodwill that has to be written off by 1994 under current law.
Many thrift managers are complaining that the time frame is too short, and will force institutions to file capital plans with the thrift agency. That invites "micromanagement" by the regulator, said Darrell R. Rains, chief financial officer of Palmetto Federal Savings of Aiken, S.C., who testified Wednesday.