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Montana Acts to Oversee Troubled B of A Insurer

March 07, 1985|United Press International

HELENA, Mont. — State Auditor Andrea Bennett has assumed supervision of a Missoula-based insurance firm implicated in $89 million of a $95-million securities write-off by BankAmerica Corp.

Bennett issued a "summary order of supervision" Tuesday, giving her office authority over all major transactions by Glacier General Assurance Co.

Last week, she had ordered an intensive examination of the company's solvency.

A California Superior Court judge in Orange County authorized the state Insurance Department to seize Glacier General assets in California, accepting the department's contention that the firm's liabilities exceeded its assets by $37.2 million. The state's order of "conservatorship," issued Monday, also prevents lawsuits from being filed against the company in California.

Glacier conducted its business in California from an office in Tustin.

"We will be working with California to ensure the protection of Glacier General's policyholders," Bennett said.

BankAmerica announced the $95 million in losses for the fourth quarter of 1984 and accused Glacier General of failing to make good on its policies insuring mortgage payments, now delinquent, which were used to back $89 million in securities. State and federal investigators in Texas and California have alleged that the values of some of the mortgages were greatly inflated.

Glacier General President John Hayden, who Bennett said has consented to the supervision order, has denied wrongdoing by his firm.

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