Trent R. Feldman, managing director of Kaplan Associates Inc., Washington, D.C., says the market for mutual thrifts converting to stock is sizzling. But the market does face some hurdles.

For one thing, rising interest rates could cool investor ardor for thrifts. Then there are new regulations. The Office of Thrift Supervision issued rules in April restricting the ability of thrift insiders to profit from conversions. And just this week, the OTS lashed out at thrift appraisers for the rapid stock-price rises that often follow conversions. The agency is concerned that appraisers are setting unrealistically low values on thrifts planning to converts.

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