Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, February 2, 1991 TAG: 9102020149
SECTION: SPORTS PAGE: B1 EDITION: METRO
SOURCE: JACK BOGACZYK SPORTSWRITER
DATELINE: LENGTH: Medium
When the Resolution Trust Corp. took over CorEast Savings Bank on Friday, a three-year, $500,000 contract the thrift had with Virginia Amateur Sports was jeopardized.
Not long before before the RTC's federal regulators stepped in, CorEast's downtown Roanoke branch hand-delivered a $37,500 check to the Virginia Amateur Sports offices in the Shenandoah Building.
"You can't be serious," VAS president and State Games director Doug Fonder said when a reporter broke the news to him that CorEast had been placed under receivership by the federal government. "Tell me you're joking. Please."
The thrift, renamed CorEast Federal Savings Bank by Resolution Trust, paid VAS $150,000 for title sponsorship of the first Roanoke-based State Games last summer. The non-profit organization has another $150,000 CorEast commitment for the '91 Games, scheduled June 27-July 7.
The CorEast money is 41 percent of VAS' 1991 operating budget.
Fonder said the check delivered to his office Friday was the second for $37,500 from CorEast this year, meaning the State Games have received half of the CorEast '91 commitment.
Fonder is in Dallas for the National Congress of State Games and U.S. Olympic Committee meetings. He said he is scheduled to return to Roanoke on Sunday, but likely will change his plans and return today to look into the CorEast situation.
"We're planning on going ahead with the Games," Fonder said, after taking a minute to consider the stunning news. "We'll see if CorEast wishes to continue as a title sponsor, and, if not, then we'll try to find another immediately.
"I think CorEast was happy - I know they were happy - about their involvement with the Games. It became one of the most talked-about title sponsorships in the state. However, I'm sure they'll be concerned about the people who have money in the bank before they get to us. We'll just have to see where we are."
Charles Wilbourne, executive vice president of CorEast Savings Bank, is a Roanoke native and was instrumental in putting together the CorEast-State Games relationship. Reached Friday evening at CorEast headquarters in Richmond, Wilbourne said he could not comment on whether the thrift in receivership would continue its State Games commitment.
"Any comment has to come from the Resolution Trust Corporation," Wilbourne said.
The RTC is the arm of the Federal Deposit Insurance Corp. that manages and tries to bring resolvency to troubled banks and thrifts. The Office of Thrift Supervision said it placed CorEast in receivership because it was "operating in an unsafe and unsound condition in that it had insufficient capital, with no prospect of replenishment without federal assistance."
CorEast had a net loss of $50 million for the fiscal year ended March 31, 1990, and operating losses of $9.3 million for the six months ended last Sept. 30.
Andrea Plater, a spokeswoman for the RTC, said a decision on State Games future sponsorship would have to be made by Ronald Rizner, the RTC's managing agent for CorEast Federal Savings Bank.
"He's the one who will oversee the day-to-day business," Plater said. "He would have to make that decision. This is something on which it's far too early to get an answer."
Rizner was unavailable for comment.
Bob Hartman, the CorEast State Games director, said he heard about the CorEast takeover late Friday afternoon.
"I don't know what effect this will have on the Games," said Hartman, whose '91 plans include an increase from 29 to 41 sports in the Olympic-style competition. "Obviously, we'd have to be a pretty low priority among the things they have to concern themselves with.
"We are going ahead with the planning and organization of the Games. It's our intention to have the Games, and we're going 150 percent toward June and July."
by CNB