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A one-time $27 million assessment to help recapitalize the thrift insurance fund caused an 81.7 percent drop in third-quarter profit at First Federal Savings and Loan Association of Rochester, the thrift reported Monday.

For the three-month period ending Sept. 30, First Federal recorded net income of $1.97 million, compared to $10.83 million one year ago.

Excluding the one-time charge to help replenish the Savings Association Insurance Fund (SAIF), First Federal's quarterly earnings, including tax adjustments, would have jumped 64.3 percent to $17.8 million.

While the assessment put a major dent in First Federal's third-quarter bottom line, Thomas N. Borshoff, First Federal's president and chief executive officer, said the long-term impact is much more positive.

"The enactment of the SAIF legislation is good news for the thrift industry and consumers because it levels the playing field in the competition for the consumer's savings dollars," Borshoff said. "We now estimate that First Federal's insurance premiums will drop about $9 million annually -- a significant cost reduction."

The thrift operates 79 branches in New York State, including 14 in the Buffalo area.

For the first nine months of the year, First Federal reported net income of $64.3 million, up 104 percent from 1995's $31.46 million.

The results were affected by a second-quarter recapture of $35.2 million freed from a fund set up to resolve tax costs.

Discounting the one-time impact of the two non-recurring items, net income for the first three quarters of 1996 was $45 million, up 42.9 percent from $31.46 million.

Borshoff said 1996 will be another year of record earnings for First Federal, with the thrift's mortgage banking subsidiary helping to lead the way.

Through nine months, Nationwide Mortgage Services had funded loans totaling $1.94 billion, versus $2.15 billion for all of 1995. Loan applications through Sept. 30 totaled $3.18 billion.

The mortgage increase has to be welcome news for Marine Midland Bank, which in August reached agreement with First Federal parent CT Financial Services of Toronto to acquire First Federal for $620 million.

No closing date for the purchase has been set.

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