WASHINGTON -- Federal regulators pledged $6.7 billion Wednesday to assist two major acquisitions involving six insolvent savings and loans institutions, one the largest foundering thrift in the country.
The Robert M. Bass Group Inc., of Fort Worth, Texas, will invest $500 million over the next three years to acquire American Savings, of Stockton, Calif., the nation's largest insolvent thrift.
The Federal Home Loan Bank Board will provide a total of $1.7 billion in financial assistance to bring to fruition a deal that has been more than a year in the making.
In the second deal, Gerald Ford, chairman of Ford Bank Group, in conjunction with MacAndrews and Forbes Holdings Inc., New York, a private investment group, is investing $315 million in new capital to acquire five insolvent Texas thrifts under the bank board's Southwest Plan.
Two of the thrifts, Gibraltar Savings Association, Houston (assets: $6.1 billion), and First Texas Savings Association, Dallas (assets: $3.5 billion), are among the largest thrifts in Texas. The five thrifts had combined assets of $12.2 billion.
The bank board has agreed to kick in $5 billion to assist the deal.
'I am amazed by the number,' said Bert Ely, a financial analyst based in Alexandria, Va. 'It is so much larger than I thought it would be. But it's just further confirmation that the losses are of a far greater magnitude in Texas than the bank board has ever been willing to admit.'
In addition to First Texas and Gibralter, which bank board Chairman M. Danny Wall called 'rather infamous,' Home Savings and Loan Association (assets $568.3 million); Killeen Savings and Loan Association (assets $256.6 million); and Montfort Federal Savings and Loan Association (assets $1.8 billion), will be merged into the new institution.
Montfort is the product of a previous merger with Vernon Savings and Loan, a deal that cost the bank board $1.3 billion, Federal Savings and Loan Deposit Corp. Director Stewart Root said.
The consolidation of the five Texas thrifts will cause no interruption to depositors, bank board officials said. All 132 of the former offices of the thrifts were to reopen Wednesday as branches of First Texas Bank, F.S.B.
Wall said the new owners plan to close about 60 of those branches by the end of 1989.
With the investment of $315 million, the bank board said its Southwest Plan has attracted $845.8 million in new capital to Texas thrifts. The transaction brings the number of insolvent thrifts dealt with under the plan to 74.
The American Savings deal culminates months of negotiations between the Bass Group and the bank board and differs from the original acquisition plan announced Sept. 5 in two significant areas.
The new bank will be federally chartered, rather than state chartered, and therefore will not be able to engage in a full range of so-called merchant bank activities, which involve more risky loans to a variety of endeavors.
A subsidiary, however, will be allowed to make more restricted such loans.
Also, the Bass Group is cutting its total investment from $550 million to $500 million, with only $350 million of that put up immediately.
Wall said the Bass Group now intends to operate 'a very nearly plain vanilla savings and loan.'
American's $30.1 billion in assets are being transferred to two new federally chartered stock institutions, one of which will dispose of the thrifts bad loans.