WASHINGTON - The possibility is fading that any taxpayer money will be included in the Clinton administration's sweeping solution for the Savings Association Insurance Fund.

The administration's plan, expected this week, is unlikely to advocate spending billions of unused Resolution Trust Corp. dollars.

Without public funds, pressure grows on the banking industry to kick in cash or consent to a merger of the bank and thrift funds.

"If the RTC money goes there are a lot of people who say the solution to this thing is to merge the funds right now, and that would be the worst of all worlds for the banks," said L. William Seidman, the former Federal Deposit Insurance Corp. chairman who has vocally supported a transfer of the RTC surplus to the thrift fund.

Sources on all sides of the insurance fund debate concede that the politics of the situation make it unlikely that RTC money will be diverted.

"The S&L industry is not going to be put ahead of the taxpayer, no way," one industry lobbyist noted. "You don't have to be a genius to figure that out."

After the $150 billion bailout of the 1980s, Uncle Sam is finished helping the thrift industry, according to William A. Cooper, chairman and chief executive of TCF Financial Corp. in Minneapolis, which controls $7.5 billion of thrift assets.

"I don't think the government is going to come up with any other money," Mr. Cooper said in an interview last week.

After struggling for weeks to find a way to use RTC funds without increasing the budget deficit, government officials concur.

John D. Hawke, nominee for Treasury under secretary, indicated at his June 7 confirmation hearing that the thrift fund's rescue would not include RTC money.

"In my judgment, these problems need to be solved with what I would call private solutions," Mr. Hawke said. "I don't think that we ought to be coming forward asking for any sort of taxpayer contribution at this time."

"More and more lawmakers have told us that it is less and less likely that taxpayer funds will be available to replenish the SAIF," FDIC Chairman Ricki Helfer told a gathering of Kansas bankers last week.

In a separate speech, Ms. Helfer told bankers that refusing to contribute to the thrift fund's rescue now could lead to a merger of the funds later.

If the government cannot forge a compromise on mending the thrift fund this year, Ms. Helfer said, a merger with the Bank Insurance Fund "becomes compelling."

While it's unlikely that RTC money will be used to rebuild the thrift fund or pay off its bond debts, public funds could still provide a backstop if the fund is hit with unexpectedly large losses.

The leading legislation to fix the thrift fund, introduced this month by Rep. Bill McCollum, R-Fla., would allow it to tap RTC money if thrifts failures exceed expectations.

But even if that occurs, the fund still needs $6.6 billion to reach the congressionally mandated 1.25% reserve level. It also remains on the hook for $780 million in interest payments due annually on Financing Corp. bonds.

By contrast, the FDIC said last week that the Bank Insurance Fund's reserves hit 1.22% on March 31.

The McCollum bill would require banks to pay about 75% of the yearly Fico tab and would merge the two funds once the thrift fund is capitalized. The Florida Republican's legislation, however, would not require thrifts to pay a one-time assessment to rebuild their fund.

Ms. Helfer, however, said last week that policymakers agree thrifts should be forced to pony up the $6.6 billion required to rebuild the fund.

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