RTC Chief Wary of Plan for S&Ls; : Thrifts: Albert Casey doesn’t like a proposed strategy to use taxpayer money to prop up shaky institutions.

Albert V. Casey, the new thrift cleanup chief, said Wednesday that he is wary of a proposed strategy to use taxpayer money to prop up shaky savings and loans as a way to reduce the cost of future bailouts.

“I am not an enthusiast of early resolution. There are other ways to do it,” said Casey, chairman of the Resolution Trust Corp., in an interview.

Casey is the first Bush Administration official to cast serious doubt on the program, which is a centerpiece of the Office of Thrift Supervision’s efforts to get the thrift industry back on its feet after billions of dollars in losses.

OTS Director Timothy Ryan has argued that regulators can rid the industry of weak institutions by giving owners of shaky thrifts the financial incentive to merge with strong ones.

Without incentives, they resist a sale and an eventual collapse proves far more costly for the government to clean up than inducing them to sell early, according to Ryan.

Already, taxpayers have paid $105 billion for the RTC to close and sell off hundreds of failed thrifts. Final costs before interest are expected to be about $160 billion.

Prospects that two huge West Coast thrifts--Glendale Federal Bank and California Federal Bank, both with more than $15 billion in assets--might collapse are driving Ryan’s plan.

Thrift regulators were to hold a hearing on the plan, called Early Resolution Assisted Mergers.

But Casey said he does not need it.

Regulators can already strong-arm large troubled thrifts into a merger, as they did last January in selling Perpetual Savings Bank of Alexandria, Va., to Crestar Financial Corp.

He is confident that he can sell one West Coast thrift with more than $10 billion in assets the same way. Five potential buyers are now poring over its books and will bid on different categories of assets and deposits, he said.

The RTC may help finance the sale of some assets and provide guarantees against losses on bad loans. But the RTC need not pay off stockholders because that raises philosophical problems for Congress, which voted money for depositors only, he said.

Another problem Casey has with the plan is that in deciding which thrifts should survive, “you are playing God.”

Casey, 71, took the helm at the RTC last October when Congress said it wanted a thrift czar to lead the government’s unprecedented sale of $130 billion in failed thrift assets.