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FDIC Enforcement Decisions and Orders

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   [10,508A] In the Matter of New West Federal Savings and Loan Association, Stockton, California, Docket No. 92-98kk (4-7-92).

   FDIC issues order conditionally granting approval for waiver of cross-guaranty.

   [.1] Holding Company—Injection of Capital—Condition of Cross-Guaranty Waiver

   [.2] Holding Company—Stock Restrictions—Condition of Cross-Guaranty Waiver

   [.3] Cross-Guaranty—Waiver—Board of Directors Restricted

   [.4] Cross-Guaranty—Waiver—Recapitalization—Minimum Requirements

   [.5] Cross-Guaranty—Waiver—Compliance with Federal Reserve Act Restrictions—Required

   [.7] Cross-Guaranty—Waiver—Revocation for Non-Compliance

   [.8] Cross-Guaranty—Waiver—Reasonable Losses

   [.9] Cross-Guaranty—Waiver—Permanence—Minimum Requirements

In the Matter of
NEW WEST FEDERAL SAVINGS AND LOAN ASSOCIATION
STOCKTON, CALIFORNIA
AMERICAN SAVINGS BANK, F.A.
STOCKTON, CALIFORNIA
(Insured Depository Institutions)
To be Related to
FAMILY SAVINGS BANK, FSB
LOS ANGELES, CALIFORNIA
(Commonly Controlled Insured Depository Institution)
ORDER CONDITIONALLY GRANTING APPROVAL FOR WAIVER OF CROSS-GUARANTY

FDIC-92-98kk

   WHEREAS, Keystone Holdings, Inc., Fort Worth, Texas ("Keystone"), has made a proposal to the Office of Thrift Supervision ("OTS") and the Federal Deposit Insurance Corporation ("FDIC") to recapitalize Family Savings Bank, FSB, Los Angeles, California ("Family"), through investing in a qualified stock issuance offered by Family ("QSI") and to comply with certain other conditions and restrictions imposed by the FDIC and the OTS;

   WHEREAS, as a result of the proposal, New West Federal Savings and Loan Association, Stockton, California, and American Savings Bank, F.A., Stockton, California (collectively "Insured Institutions"), which are currently controlled by Keystone, may become potentially liable to the FDIC pursuant to section 5(e) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. §1815(e), for losses incurred or reasonably anticipated to be incurred by the FDIC in connection with the default of Family, should Family ever go into default, as a commonly controlled insured depository institution;

   WHEREAS, in conjunction with the proposal, Keystone has made application on behalf of the Insured Institutions to the FDIC for an exemption pursuant to the provisions of section 5(e)(5)(A) of the Act, 12 U.S.C. §1815(e)(5)(A); and

   WHEREAS, the Board of Directors of the FDIC ("Board") has fully considered the facts and information relating to the application for exemption and has concluded that approval of the application is in the best interests of the Savings Association Insurance Fund and should be granted, subject to certain conditions and restrictions set forth below.

   IT IS THEREFORE ORDERED:

   The request of Keystone for an exemption pursuant to the provisions of section 5(e)(5)(A) of the Act, 12 U.S.C. §1815(e)(5)(A), is hereby granted, subject to the following conditions as set forth below in this ORDER CONDITIONALLY GRANTING APPROVAL FOR WAIVER OF CROSS-GUARANTY ("ORDER"):

   [.1]1. On or before April 10, 1992, Family will be recapitalized through an injection of $1,000,000 in cash by Keystone as a result of the QSI.

   [.2]2. At no time while this ORDER is in effect will Keystone acquire more than fifteen percent (15%) of the common stock of Family.

   [.3]3. Without the prior written approval of the FDIC, Keystone will not seek or accept representation of more than one member of the board of directors of Family or of any holding company thereof.

   [.4]4. Keystone will comply with the conditions set forth in paragraphs 1(B) through (F) of OTS Order No. 92-66, dated February 28, 1992 ("OTS Order"), attached hereto and made a part hereof.

   5. Keystone shall ensure that all requisite documents and approvals have been obtained from any necessary parties, including the OTS, in order to consummate and effectuate the conditions and transactions upon which this ORDER is based.

   [.5]6. During the time this ORDER is in effect, the Insured Institution and all other insured depository institution affiliates of the Insured Institutions shall comply with the restrictions set forth in section 5(e)(5)(B) of the Act, 12 U.S.C. §1815(e)(5)(B), concerning the requirements of sections 23A and 23B of the Federal Reserve Act, 12 U.S.C. §§ 371c and 371c-1.

   [.6]7. If Keystone fails to inject $1,000,000 into Family by April 10, 1992, as described in paragraph 1, above, such failure will render this ORDER null and void, without further hearing on the matter.

   [.7]8. Failure of Keystone to comply with the conditions enumerated in paragraphs 2 and 3 will render this ORDER null and void, without further hearing on the matter.

   9. If the OTS finds, after notice and hearing, that Keystone has failed to comply with the conditions set forth in paragraphs 1(B) through 1(F) of the OTS Order, this ORDER shall become null and void, without further hearing on the matter.

   [.8]10. This ORDER for an exemption pertains only to losses incurred or reasonably anticipated to be incurred by the FDIC in connection with any default of or assistance provided to Family.

   [.9]11. Provided that Keystone complies with all conditions enumerated in this ORDER, this ORDER will become a permanent exemption as to losses incurred or reasonably anticipated to be incurred by the FDIC in connection with any default of or assistance provided to Family.

   By direction of the Board of Directors.

   Dated at Washington, D.C., this 7th day of April, 1992.

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