Metropolitan Mortgage reconsidering reorganization plan

New York, March 5 - Metropolitan Mortgage & Securities Co. Inc. said it is reconsidering its proposed reorganization plan after the Washington State Office of the Insurance Commissioner took actions affecting its Western United Life Assurance Co. subsidiary.

Western United Holding Co., the direct parent of Western United Life Assurance, is not involved in Metropolitan Mortgage's Chapter 11 case, but the company said the events may affect its reorganization and have prompted it to consider options other than its previously announced issuance of equity for its existing debt.

The Spokane, Wash., company said that this week the Washington State Office of the Insurance Commissioner took actions to initiate a voluntary rehabilitation of, appoint a receiver for, and assume control of Western United Life Assurance.

"We understand that the commissioner took this action to ensure the financial protection of WULAC," said William A. Smith, Metropolitan Mortgage's chief financial officer, in a news release. "We believe that the OIC's actions are taken to protect WULAC's policyholders and annuitants."

Meanwhile Summit Securities, which filed for Chapter 11 with Metropolitan Mortgage, made a similar statement and similar comments about its reorganization following actions by the Arizona and Idaho state departments of insurance to initiate a voluntary rehabilitation of, appoint a receiver or rehabilitator for, and assume control of Summit's wholly owned subsidiaries Old West Annuity & Life Insurance Co. and Old Standard Life Insurance Co.

Metropolitan Mortgage and Summit filed for Chapter 11 on Feb. 4 in the U.S. Bankruptcy Court for the Eastern District of Washington, in Spokane.

Metropolitan Mortgage invests in receivables and other investments and also sells annuities through its largest subsidiary, Western United Life Assurance Co.

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