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Highlights Of House S&l Bill


1. $50 billion in bonds will be sold over three years, with the funds used to pay off depositors when ailing thrifts are closed.

2. A new Resolution Trust Corp. will dismantle the financially crippled S&Ls and dispose of $400 billion in repossessed real estate--homes, apartments, shopping centers, office buildings and land--owned by the failed thrifts.

3. An S&L's owners will be required to supply the institution with $1.50 in cash for every $100 in loans it makes, beginning in June, 1990. This capital standard rises to 3% in 1995.

4. S&L payments to the federal insurance fund will rise from $2.10 per $1,000 of deposits to $2.30. Bank premiums will climb from 8 cents per $1,000 to 15 cents.

5. The Justice Department will receive $75 million to investigate and prosecute fraud at financial institutions.

6. The home loan banks owned by the S&L industry will supply $75 million a year to help subsidize housing for people with low or moderate incomes.

7. The Federal Deposit Insurance Corp., which regulates banks, will become the new overseer of S&Ls.

The total cost of the package is estimated at $157 billion over 10 years. This includes the $50 billion in bonds for future S&L shutdowns, the expenses associated with previous closings and the rebuilding of the federal insurance fund.

The bonds will be paying interest for 30 years, and the final cost of the bailout is estimated at $275 billion to $300 billion. The taxpayers will furnish about 75% of the total cost, with the balance coming from premiums on the savings and loan industry.

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