Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, February 6, 1991 TAG: 9102060045
SECTION: BUSINESS PAGE: B5 EDITION: METRO
SOURCE: MAG POFF BUSINESS WRITER
DATELINE: LENGTH: Medium
Ronald Risner, managing agent of the thrift for the Resolution Trust Corp., said the RTC is evaluating its lending offices in Roanoke, Lynchburg and Richmond but hadn't closed them.
Risner, who has operated the thrift from Richmond since the RTC assumed control on Friday, said none of the affected employees had been laid off. He said they were on the payroll at least through today.
"We are looking at the people in the lending functions and deciding which ones are going to be needed," Risner said.
Any customer who has a loan with CorEast is expected to honor its terms, he said, but CorEast is "not interested in continuing our lending function." He said CorEast would make no new loans while it is in federal receivership - including previously committed mortgage loans.
Under the federal law that created the RTC, he explained, an institution in federal conservatorship has the power to repudiate loan commitments. He said RTC attorneys were reviewing all commitments and would make decisions in each case on whether to honor its terms.
Banks and thrifts generally earn their income by making loans. But Risner said the situation is different when a financial institution is in conservatorship.
One of the first goals at this point, he said, "is to reduce expenses."
Risner said the RTC wants to preserve the assets of CorEast until it finds a healthy financial institution willing to buy it.
He also said that CorEast, as an insolvent thrift, has only limited funds available to lend.
by CNB