Ford Reportedly Planning to Buy Several Ailing S
Ford Motor Co. is trying to buy a group of ailing thrifts that have combined assets of more than $19 billion from the Federal Savings and Loan Insurance Corp., National Thrift News, a trade journal, says in a report.
Both Ford and FSLIC declined to comment on the report appearing in the trade journal’s issue of Monday, Dec. 12.
If Ford were to make a successful bid, its First Nationwide Bank savings and loan unit would be the largest U.S. thrift. First Nationwide currently has more than $23 billion of assets and earned $91 million pretax profits last year.
National Thrift News reported that Ford seeks to purchase thrifts in Texas, Colorado, Michigan, Ohio and Illinois. Ford will inject $400 million to $600 million into the Colorado and Texas thrifts alone, the report said.
Advantage of Speed
None of the thrifts contacted was able to confirm the trade journal’s report. According to the report, the deal hinges on Ford’s obtaining a favorable Internal Revenue Service ruling that would give it $3 billion to $4 billion in tax benefits over a 10-year period.
Bankers said the tax benefits could be much less if the deal is not completed by the end of the year because FSLIC assistance, which is currently 100% tax-free, will be only 50% tax-free next year.
National Thrift News reported that Ford seeks to buy the following thrifts from FSLIC:
- First Texas Savings Assn. in Dallas and Gibraltar Savings Assn. in Houston, which have combined assets of about $9 billion, plus a few other Texas thrifts. Spokesmen for these thrifts said Ford was a rumored bidder but that they had not heard anything definite.
- Silverado Banking, Saving & Loan Assn., with $2.4 billion of assets, and Columbia Savings, with $3.1 billion of assets, as well as several unidentified thrifts in Colorado. Silverado and Columbia spokesmen said they had no direct knowledge of a bid from Ford. The Columbia spokesman said, “We have no reason to doubt that Ford is a serious negotiator.”
(Late Friday, the Federal Home Loan Bank Board said it had liquidated Silverado, and that a newly chartered thrift known as Mile High Federal Savings & Loan Assn. of Denver had been set up to acquire Silverado’s insured deposits. Negotiations for Mile High are under way.)
- Cardinal Federal Savings Bank in Cleveland, with $1.5 billion of assets. Company officials were not available for comment.
- Bloomfield (Mich.) Savings & Loan Assn., with $698 million in assets, and First Dearborn in Michigan, with $200 million in assets. A First Dearborn spokesman declined to comment and Bloomfield officials could not be reached for comment.
- Pathway Financial Federal Assn. in Chicago, with $1.6 billion in assets. A company official declined to comment.
