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
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. …