BofA Upset at FDIC’s Pace in Selling Off Failed Bank

Officials at BankAmerica Corp. and the Federal Deposit Insurance Corp. are embroiled in a dispute over the FDIC’s pace in entertaining bids for the failed Bank of New England.

In a presentation to investors at the annual Montgomery Securities Financial Institutions Conference in Newport Beach, BankAmerica Chief Executive Richard M. Rosenberg said that when the San Francisco-based banking firm confirmed Jan. 7 that it was interested in acquiring the huge Bank of New England, it did so “in the expectation that the FDIC would resolve matters much more quickly than has occurred.”

Rosenberg did not elaborate, and a BankAmerica spokesman declined additional comment.

Alan Whitney, an FDIC spokesman, confirmed that the BankAmerica officials have “expressed a desire to move more quickly” and disputed suggestions that it isn’t moving fast enough.

“You can do things quickly or you can do them right. Our objective is to do things in a correct way,” Whitney said. He noted that the bank failed Jan. 6 and that the FDIC’s deadline for bids is March 15.

“We are moving very quickly” he said.

BankAmerica, parent of Bank of America, is considered by many bankers to be the leading candidate to buy the New England bank, whose three units were seized by regulators in what was the third-largest bank failure in U.S. history. Banc One of Columbus, Ohio, is also a top contender.

Rosenberg suggested that the bank is taking a hard line in negotiating. He said he believes that New England is a good market despite its economic woes and that Bank of New England had a top-quality branch system. But he added that buying Bank of New England “is not a strategic imperative” for BankAmerica.

“If we are not convinced that a transaction would enhance shareholder value, we’ll walk away and look for a more attractive opportunity,” Rosenberg said.

Separately, BankAmerica late Friday agreed to pay $1.5 million for two failed New Mexico thrifts.