Timothy Ryan, director of the Office of Thrift Supervision, and three officials representing other federal banking agencies are touring the country, asking businessmen for ideas about how to end the so-called credit crunch.

Last week they met in Los Angeles, in the first of seven nationwide stops.

The team included John LaWare, a Federal Reserve governor; C.C. Hope, a Federal Deposit Insurance Corp. director; and Stephen Steirbrink, acting comptroller of the currency. Mr. Ryan said they got an earful of candid answers from borrowers who need loans but can't find a bank willing to lend.

Mr. Ryan shared his Los Angeles experiences with reporter Bill Atkinson of the American Banker's Washington bureau.

American Banker: Isn't this nothing more than a political move by the Bush administration to demonstrate its concern over the economy?

Timothy Ryan: I don't see it as a political move at all. I don't see the politics of it being a factor. Most of these meetings are going to take place after the election.

AB: Do you think the meeting helped matters?

TR: C.C. Hope and I thought it was one of the best things we've done since we've been in these jobs.

AB: Why?

TR: People where candid. I had an opportunity to meet people who were on the firing line.

AB: What did you learn from the meeting?

TR: I think there is a credit availability problem in [several] areas. I think it is incumbent upon the federal government to do whatever we can to address the issues if we can.

AB: What can you do?

TR: The No. 1 thing we can do now, and we are in the process of doing it, is to develop reasonable standards that provide some stability.

We should not be in the process of constantly changing them. We need to have standards fixed and keep them. AB: What do you mean by fixing standards? TR: There's confusion that exists now as to lending standards in real estate.

We've put out the proposal for real estate lending standards in and since we haven't finalized them, people are not sure of the appropriate loan-to-value ratios. We need to address that soon. AB: Are there any other confusing standards? TR: There is concern with restructuring existing loans at a time when appraisals tend to be oriented more toward liquidation valuations.

That is not an appropriate way to value the loan. That's clearly a concern of ours. We spent a lot of time trying to address that issue.

I'm not sure that all of the appraisers have gotten that message. At least what we are told is that appraisers are very concerned about their potential liability. So they are making very conservative assessments of values.

AB: Don't you, as a regulator, accept any blame for the credit crunch?

TR: I would rather put in a larger scheme - and I can speak directly only about thrifts.

We can pinpoint specific regs, and we can talk about regulators having an individual impact. But clearly, the resolution of 720 [thrift] institutions and another 300 that have disappeared because of merger or acquisition have had an impact on credit availability.

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