United Federal Savings and Loan Association in Durant, Okla., was declared insolvent and placed into receivership Monday by the Federal Home Loan Bank of Topeka, Kan.
The thrift had $91.3 million in assets and operated branch offices in Oklahoma City, Atoka and Hugo.
All assets, deposits and liabilities were transferred to a newly chartered federal mutual association which will be known as United Savings.
United Federal had substantially dissipated its assets and earnings due to violations of law and unsafe and unsound practices associated with the bankrupt Savings Investment Service Corp. of Edmond, according to Bill Conly, spokesman for the Federal Home Loan Bank.
At the end of the fourth quarter, ended Dec. 31, 1986, United Federal had a negative regulatory net worth of $2.6 million and reported a net loss of $5.4 million. Its assets dropped from $101.1 million in the third quarter of 1986 to $98 million at the end of the year.
Third quarter deposits totaled $78.3 million, and the institution had a regulatory net worth of $2.5 million. It sustained a net loss of $1.1 million in the third quarter.
The new association will reopen today maintaining the thrift's headquarters in Durant, the same office hours and services.
A five-member board of directors for the new association was approved Monday by the Federal Home Loan Bank board in Washington, D.C. The board is headed by Chairman Lloyd A. Cole, former vice president of Mortgage Guaranty Insurance Co. in Shawnee, Kan.
Other directors are Kenneth L. Brown, chairman of First Community Federal Savings and Loan Association, Winfield, Kan.; John W. Laisle, president of MidFirst Savings and Loan Association, Oklahoma City; R. J. Lollar Jr., president of First Federal Savings Bank of Oklahoma, Claremore, Okla., and Keith L. Smith, chairman and president of First Western Savings and Loan Association, Oklahoma City.
A management contract was approved with Hewitt, Olson, Smoker & Associates Inc. of Ft. Lauderdale, Fla., a consulting firm for financial institutions.
United's regulatory capital deteriorated after it acquired large holdings of substandard assets in 1984 and 1985 as a result of imprudent underwriting policies and controls on loans …