Thrift Institution Forbearance Act

Thrift Institution Forbearance Act - Amends the Home Owners' Loan Act of 1933, the National Housing Act, and the Federal Home Loan Bank Act to allow capital forbearance for thrift institutions with a net worth of 0.5 percent or more if the association's weak capital condition is due to: (1) losses on loans made in an area adversely affected by economic conditions; or (2) losses on loans made by a minority association 50 percent or more of whose loan assets are minority loans and 50 percent or more of whose loans are construction or permanent loans for one to four family residences. Requires that such an association must submit a plan to increase its capital in order to be eligible for such forbearance and that its weak capital condition must not be the result of imprudent operating practices.

Allows a similar forbearance for institutions with a net worth of less than 0.5 percent upon the institution's request if the appropriate regulatory agency determines that the institution's weak financial condition is based on such loan losses and that the institution has reasonable prospects of returning to a satisfactory capital level.