Major Iowa Savings and Loan Fails
DES MOINES, Iowa (AP) _ Federal regulators took over the nearly $1 billion American Federal Savings and Loan Association of Des Moines on Friday over concern that it could not meet its capital requirements.
Officials said it was the largest failure ever of an Iowa thrift.
No depositor lost any money and all accounts remain federally insured, said Jerry Orman of the federal Office of Thrift Supervision.
The thrift has $968 million in assets and $828.5 million on deposit at offices in 14 Iowa communities.
The federal Resolution Trust Corp. seized all deposits, named a managing agent to supervise operations and said the thrift would re-open Saturday as American Federal Savings Association of Iowa.
″It became apparent with their continuing operating losses they were going to be unable to meet their capital requirements without some form of government assistance,″ Orman said.
He said the thrift’s liabilities exceed its assets by $28 million.
The Resolution Trust Corp. and Office of Thrift Supervision were set up by Congress as part of a multibillion-dollar program to salvage failed thrifts.
″This would be by far the biggest takeover in Iowa,″ said Gregg Barcus, the superintendent of the state savings and loan division.
Being placed in conservatorship means the thrift continues to operate while the Resolution Trust Corp. seeks to minimize losses and insure prudent operations. The government also will try to seek a buyer.
A Resolution Trust Corp. managing agent, Jerry Brandt, was put in charge of the thrift, but Orman said no other management changes were anticipated.
Orman said American Federal had been experiencing operating losses over several years as a result of out-of-state problem loans in the early 1980s. He said no wrong-doing is suspected.