Territory Savings and Loan Association of Seminole, which had a negative regulatory net worth of $40.6 million as of Nov. 30, was closed Friday by Oklahoma Banking Commissioner Wayne Osborn and the Oklahoma State Savings and Loan Board.
The facility was insolvent, and its assets, totaling 37.8 million, were less than its obligations to creditors, including the holders of its withdrawable accounts, Osborn said. The Federal Home Loan Bank of Washington, D.C., reported liabilities were $78.5 million.
The thrift had 2,429 deposit accounts totaling $73 million.
The Federal Savings and Loan Insurance Corp. is the receiver for the closed institution. However, its insured deposits will be transferred to Commercial Federal Savings & Loan Association of Omaha, Neb., and the Seminole office will be opened as a branch of Commercial Federal on Monday, the home loan bank said.
Commercial Federal paid the FSLIC a discount of approximately $4.4 million or 6.1 percent of insured deposits, the home loan bank reported. Commercial Federal is federally-chartered stock institution, insured by the FSLIC with $6 billion in assets and 67 offices in Nebraska, Colorado and Kansas.
Commercial also owns a mortgage banking subsidiary, Commercial Federal Mortgage Corp., which operates residential lending offices in Oklahoma City and Tulsa.
"This acquisition provides us with the opportunity for additional expansion in Oklahoma and is another important step in our strategic plan to build a multi-state retail financial business," said William A. Fitzgerald, president and chief executive officer of Commercial Federal.
Territory's insured deposits will continue to be insured by the FSLIC, but FSLIC representatives will need to complete an insurance determination for depositors with accounts of $100,000 or more before they can gain access to their insured funds, the bank said.
Depositors with uninsured funds will share in the proceeds of liquidation on a pro rata basis with the FSLIC, it was reported.
Commercial Federal's parent company, Commercial Federal Corp. of Omaha, reported earnings of $8.8 million, or $1.01 per share, for the first fiscal six months ended Dec. 31, 1987.
In a prepared statement, Osborn said repeated requests had been made to the Federal Home Loan Bank Board to close Territory.
"The continued operation of the hopelessly insolvent institution had resulted in the driving of the cost of funds up for other financial institutions in the immediate area," Osborn said.
Closing Territory and transfering its assets will cost the Federal Savings and Loan Insurance Corp. …