A story in the Business section Saturday incorrectly said Columbia First Federal Savings and Loan Association would receive cash in addition to promissory notes from the Federal Savings and Loan Insurance Corp. for taking over Family Savings & Loan of Springfield.
Family Savings & Loan of Springfield, a federally insured institution that has been propped up by the government for two years, will be acquired by Columbia First Federal Savings & Loan of Washington under a federally supervised takeover announced yesterday.
Family has been one of the most seriously troubled savings institutions in the area for some time. The Springfield thrift's liabilities exceeded its assets by more than $14 million at the end of last year, according to figures from the Federal Home Loan Bank Board.
The Bank Board yesterday approved Family's takeover by one of the area's stronger savings and loans, with net worth of $33.7 million. Family, with current assets of about $55 million, was the third-smallest S&L in Virginia. Columbia First, with assets of more than $1.2 billion is the largest federally insured thrift in the District.
A statement issued by the board said the Federal Savings and Loan Insurance Corp. will help Columbia carry out the transaction by issuing promissory notes in return for capital certificates. The Bank Board announcement did not disclose how much federal assistance will be given to Columbia, but said the merger will be arranged at no cost to FSLIC.
However, Dewitt Hartwell, chairman of Columbia, said his association will receive cash assistance from the insurance fund, though he declined to elaborate or specify the sum.
Hartwell also said that through the deal, Columbia will become the second area thrift with branches in all three metropolitan jurisdictions. Columbia already has 14 offices in the District and one in Bethesda.
Family has five branches in Virginia, and with the deal, Columbia will have the right to open other branches throughout the state, Hartwell said.
Family deposits total about $70 million, while Columbia's are $935.8 million, he said.