Deposits in Utah-based savings and loans declined 1.3 percent in February to $3.48 million, the Federal Home Loan Bank of Seattle said, while lending activity of those same institutions shot up 47 percent for the month and 69 percent for the 12 months ending February 28, 1989.

But the Utah figures include Utah-based institutions' activities in other states, which gives a more positive picture than what is actually occurring in the Beehive state, the Utah League of Insured Savings and Loans said.Excluding out-of-state business, deposits fell from $3.03 billion in January to $2.98 billion February, compared to the FHLB report of $3.52 billion in January to $3.48 billion in February, the league said.

Adhering to policy of not disclosing institutions by name, the FHLB said most of the deposit decline in Utah was attributable to two savings and loans, although only two other institutions reported gains.

The FHLB in Seattle oversees 13 S&Ls members in Utah and savings institutions in eight western states.

Three Utah S&LS, Deseret Federal, American Savings and MountainWest Savings, are insolvent and operating under regulatory management. The institutions are expected to be sold soon after Congress passes legislation that would rescue the bankrupt Federal Savings and Loan Insurance Corp. which insures S&L deposits up to $100,000.

Balances of more than $100,000 declined 3.7 percent in March to $384.4 million, while deposits of $100,000 or less dropped 1 percent to $3.09 billion. Broker originated deposits declined 3.5 percent to $157.9 million.

"It (outflow of funds) has to do with the attention the industry is getting nationwide, most of which is not positive," FHLB spokeswoman Linda Pomarantz said.

Despite the continued outflow of funds from most of Utah's savings institutions, the bank noted, the trend has slowed from $67 million in January to $58 million in February.

"We will be pleased when the legislation is passed and signed, not just because it will solve the industry's problems, but it will put the focused attention on it behind us," Pomarantz said.

FHLB lending figures for Utah were particularly misleading, considering the Salt Lake Board of Realtors blamed February's cold for 1989's sluggish start in home sales.

The huge gains in lending reported by Utah S&Ls came from one institution, but seven other S&Ls also reported increases, the FHLB said.

All types of lending except construction loans increased during February, the bank said. Mortgage lending experienced the largest gain, increasing 23 percent to $67.8 million.

Mortgage lending also led other areas in year-to-date totals, with a 68 percent hike to $123 million.

Refinancing loans contributed just $1.8 million to the increase, the FHLB said.

Commitments to originate loans held at the end of February 1989 declined 4.5 percent to $181.9 million, their lowest month-end amount since last August, the bank said. Half of Utah's S&Ls reported decreases in commitments, while those commitments represented a 2.7 month backlog in mortgage loans.