WASHINGTON -- The Federal Home Loan Bank Board helped bail out six more ailing savings and loan institutions Saturday, bringing it a step closer to resolving the status of 222 foundering institutions with assets of $90 billion.
Martha Gravlee, spokeswoman for the bank board, said the government hoped to complete one more bailout before the end of 1988 at midnight Saturday, after which tax breaks worth millions of dollars to S&L buyers are no longer available.
Since the beginning of 1988, the bank board has helped 216 of the 222 financially strapped institutions, Gravlee said, adding that the number was 'a record.'
The board has estimated that the total cost of the bailout to the government would be $38.6 billion in 1988 but has said it would cost much more to ignore the problem.
'I don't think we're going to' rebuild the remaining seven S&Ls, Gravlee said, adding the government was hoping to settle the status of at least two more institutions before the new year.
The 222 S&L failures brought the number of S&L failures in a single year to a new post-Depression high.
In separate announcements, the board said it had rebuilt six more savings and loans -- four in California, one in South Dakota and one in Florida -- capping a weeklong flurry of activity.
The five resolved are:
-Tahoe Savings and Loan Association of South Lake Tahoe, Calif., which was acquired by First Network Savings Bank through an assisted merger approved by the bank board. The board said the Federal Savings and Loan Insurance Corporation would contribute a 10-year $32 million note to assist the merger.
-Broward Federal Savings and Loan Association of Sunrise, Fla., which was acquired by a subsidiary of Los Angeles-bsed California Federal Savings and Loan Association in a federally assisted transaction. The FSLIC will contribute a 10-year, $97.4 million note to assist the merger.
-Columbus Savings and Loan Association, Cal America Savings and Loan Association and First Security, all in the San Francisco Bay area, were acquired by the Home Federal Savings and Loan Association of San Diego.
Home Federal acquired the ailing S&Ls with $25 million in new capital and an estimated $243.3 million in federal assistance, the board said, adding the FSLIC would issue a five-year, $242.6 million note.
-United Federal Savings and Loan Association of Aberdeen, S.D., was acquired by Home Federal Savings and Loan Association of Sioux Falls, S.D., also with federal assistance.
The board said the FSLIC would assist the acquisition with an $8 million cash infusion.
In its statement announcing the settlements, the board said the FSLIC has resolved 187 troubled thrifts through assisted mergers and acquisitons, one by recapitalization and 27 by insurance action settlement, for a total of 215.
At the start of 1988, the bank board identified as insolvent 511 federally insured thrifts with $180 billion in assets.
In order to resolve many of the insolvencies, the bank board has been forced to give buyers tens of billions of dollars in tax breaks, promissory notes and other subsidies. The emphasis on non-cash subsidies was the result of the ailing condition of the FSLIC.
