Business : Financial Corp. Seeks Liquidation
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Financial Corp. of America, the former holding company for American Savings, said today it intends to convert its Chapter 11 bankruptcy filing to a Chapter 7 liquidating case.
Reorganization of the company as a going concern wasn’t feasible, bankruptcy trustee David Gill said. Earlier he had said it is likely stockholders would lose their entire investments.
The Irvine-based Financial Corp. filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code on Sept. 9, when the Federal Savings & Loan Insurance Corp. seized American, then the nation’s largest insolvent thrift. American was turned over to the Robert M. Bass Group of Ft. Worth in exchange for an injection of $350 million. The government promised to provide up to $1.7 billion.
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