Continue reading Bank Failures Hit 42, Expected to Exceed 2009's 140

Bank Failures Hit 42, Expected to Exceed 2009's 140 originally appeared on BloggingStocks on Mon, 12 Apr 2010 09:00:00 EST. Please see our terms for use of feeds.

Continue reading Bank Death Toll Approaches 40

Bank Death Toll Approaches 40 originally appeared on BloggingStocks on Mon, 22 Mar 2010 09:30:00 EST. Please see our terms for use of feeds.

Four more banks bit the dust last week, bringing the total to 30 -- just shy of 75 days into 2010. Regulators closed banks in New York, Florida and Louisiana, representing in aggregate nearly $1.1 billion in assets and a little over a billion dollars in deposits.

Park Avenue Bank in New York was shut down by the FDIC this week. It had $520.1 million in assets and $494.5 million in deposits as of the end of last year. Its deposits will be assumed by Valley National Bank, which is based in Wayne, New Jersey, and it will pay a small premium for them. Valley National also agreed to pick up virtually all of the bank's assets.

Continue reading 75 Days, 30 Bank Failures

75 Days, 30 Bank Failures originally appeared on BloggingStocks on Mon, 15 Mar 2010 10:00:00 EST. Please see our terms for use of feeds.

Three more banks failed last week, bringing 2010's total to 25. Already, this year's bank failures have matched the 2008 full-year total and exceeded the 2007 amount by a factor of greater than eight. The three regional banks that failed last week were in Florida, Illinois and Maryland, with close to a billion dollars in aggregate assets. According to the FDIC, the pace of bank failures could be set to accelerate in the next few months.

Sun American Bank, in Boca Raton, was taken over by the FDIC, with First-Citizens Bank & Trust, based in Raleigh, N.C., assuming the Florida banks assets and almost all of its deposits. Sun American had assets of $535.7 million and $443.5 million in deposits. Since July, First-Citizens has acquired the assets of four failed banks, the others being First Regional Bank of Los Angeles, Venture Ban (Lacey, Wash.) and Temecula Valley Bank (Temecula, Calif.).

Continue reading Bank Failure Tally Hits 25

Bank Failure Tally Hits 25 originally appeared on BloggingStocks on Sun, 07 Mar 2010 10:10:00 EST. Please see our terms for use of feeds.

Continue reading Who profited from Bear Stearns' collapse? One insider did, and got away with it

Who profited from Bear Stearns' collapse? One insider did, and got away with it originally appeared on BloggingStocks on Tue, 20 Oct 2009 14:00:00 EST. Please see our terms for use of feeds.

What a way to go into the holiday weekend, eh? On Thursday, seven banks were shut down by authorities, which pushed the total of failed banks for 2009 to 52 -- which more than doubles the number of bank failures in 2008. Six of the seven banks seized were located in Illinois and the other was in Texas, according to the Federal Deposit Insurance Corporation (FDIC).

According to the federal group, the Illinois failures are interlinked, as all six banks were controlled by one family and used a similar business model. The FDIC noted that this model "created concentrated exposure in each institution." This model left the banks heavily exposed to collateralized debt obligations and other loan losses. The six banks brings the total of failed banks in Illinois to 12.

As for the Texas bank failure, it was the first in the state this year.

Continue reading Seven banks go up in smoke ahead of the holiday weekend

Seven banks go up in smoke ahead of the holiday weekend originally appeared on BloggingStocks on Fri, 03 Jul 2009 10:00:00 EST. Please see our terms for use of feeds.

The New York Times reports that the Federal Deposit Insurance Corporation (FDIC) is hiring back experienced people as the number of failed banks rises. Its report gives a good idea of what the FDIC does to rescue a failed bank. In a nutshell, when a bank fails the FDIC tries to find a stronger partner who can take over the foundering operations. Starting on Friday evening, the FDIC does triage so that it knows which assets and deposits the partner will get and which will go on the FDIC's books.

Here are six key steps:

• Find a merger partner. For example, the Times reports that on Friday May 9, the FDIC seized Arkansas National Bank (ANB) -- a $2.1 billion construction lender -- and arranged for it to be acquired by Pulaski Bank and Trust Company. As it usually does, the FDIC planned to use the weekend to minimize the disruption to depositors of ANB.
• Enter town quietly. FDIC personnel try not to alert the locals to their presence. The Times reports that they "used personal credit cards, rather than cards provided by the FDIC, to avoid detection." And they were told to give a false reason for their presence in town. The Times quotes Gary Holloway, a hired back retiree, who said: "If anybody asked why they were in town, they were told to say that they were with the Toy Shop on business."

Continue reading How the FDIC rescues a failed bank

How the FDIC rescues a failed bank originally appeared on BloggingStocks on Sat, 16 Aug 2008 07:00:00 EST. Please see our terms for use of feeds.