Resolution Trust Corporation:
Management Improvements Reduce Risks But Transition Challenges Remain
T-GGD-95-163, May 16, 1995
Pursuant to a congressional request, GAO discussed the Resolution Trust Corporation (RTC), focusing on: (1) management improvements that led to the removal of RTC from GAO high-risk list; and (2) the status of planning efforts for RTC transition to the Federal Deposit Insurance Corporation (FDIC). GAO noted that: (1) RTC was removed from the GAO high-risk list because it had made substantial progress in disposing of assets and addressing its weaknesses; (2) some remaining risks associated with the savings and loan cleanup need further attention, including the $8 billion in assets that will remain unsold at the end of 1995 and will be transferred to FDIC; (3) RTC and FDIC will need to ensure that sufficient controls are in place over the assets that will be sold during the remaining life of RTC, as well as the assets that will be transferred to FDIC; and (4) a number of issues need to be resolved to ensure the successful transition to FDIC, such as providing sufficient resources to complete asset disposition and other work that will transfer from RTC, making legal and policy decisions to determine how FDIC will absorb RTC responsibilities and operations, addressing staffing issues, and developing specific asset disposition plans.