BANKING & FINANCE - June 14, 1991

The Bank of New England’s ousted chairman took the blame for what became the third-largest bank failure in U.S. history. “I accept responsibility for my judgements that failed,” former BNE Chairman Walter J. Connolly told the House Banking Committee, citing his failure to foresee the collapse of the Northeast real estate market. But Connolly also blamed the sudden tightening of federal rules for evaluating loans. “Overnight we owere forced to . . . stare at the specter of a decimated loan portfolio,” he said.