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10th Bank Collapse This Year

10th Bank Collapse This Year

Bloomberg
August 29, 2008

Integrity Bank of Alpharetta, Georgia, was closed by U.S. regulators today, the 10th bank to collapse this year amid a surge in soured real-estate loans stemming from the worst housing slump since the Great Depression.

Integrity Bank, with $1.1 billion in assets and $974 million in deposits, was shuttered by the Georgia Department of Banking and Finance and the Federal Deposit Insurance Corp. Regions Financial Corp., Alabama’s biggest bank, will assume all deposits from Integrity, which was run by Integrity Bancshares Inc. The failed bank’s five offices will open on Sept. 2 as branches of Regions, the FDIC said.

“Depositors will continue to be insured with Regions Bank so there is no need for customers to change their banking relationship to retain their deposit insurance,’’ the FDIC said.

Banks are being closed at the fastest pace in 14 years as financial companies report more than $505 billion in writedowns and credit losses since 2007. California lender IndyMac Bancorp Inc., which had $32 billion in assets, was closed July 11 in the third-largest bank seizure, contributing to a 14 percent drop in the U.S. deposit insurance fund that had $45.2 billion at the end of the in the second quarter.

 

FDIC may borrow money from Treasury to see it through an expected wave of bank failures: report

Reuters
August 27, 2008

Federal Deposit Insurance Corp (FDIC) might have to borrow money from the Treasury Department to see it through an expected wave of bank failures, the Wall Street Journal reported.

The borrowing could be needed to cover short-term cash-flow pressures caused by reimbursing depositors immediately after the failure of a bank, the paper said.

The borrowed money would be repaid once the assets of that failed bank are sold.

“I would not rule out the possibility that at some point we may need to tap into (short-term) lines of credit with the Treasury for working capital, not to cover our losses,” Chairman Sheila Bair said in an interview with the paper.

Bair said such a scenario was unlikely in the “near term.” With a rise in the number of troubled banks, the FDIC’s Deposit Insurance Fund used to repay insured deposits at failed banks has been drained.

In a bid to replenish the $45.2 billion fund, Bair had said on Tuesday that the FDIC will consider a plan in October to raise the premium rates banks pay into the fund, a move that will further squeeze the industry.

The agency also plans to charge banks that engage in risky lending practices significantly higher premiums than other U.S. banks, Bair said.

The last time the FDIC had borrowed funds from the Treasury was at nearly the tail end of the savings-and-loan crisis in the early 1990s after thousands of banks were shuttered.

The fact that the agency is considering the option again, after the collapse of just nine banks this year, illustrates the concern among Washington regulators about the weakness of the U.S. banking system in the wake of the credit crisis, the Journal said.

Recent News:

Bankruptcy Filings Surge 29%
http://www.economicpolicyjournal.com/2008/08/bankruptcy-filings-surge-29.html

FDIC: Bank Profits Fell By 86% In 2nd Quarter
http://seattletimes.nwsource.com/html/busi..webbanks26.html

World Bank: More People In Poverty
http://www.reuters.com/article/worl..=RSS&feedName=worldNews

Dow Falls Another 240 Points
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Merrill, Wachovia in Danger of Failing: Strategist
http://www.cnbc.com/id/26262..Cquote%7Ctext%7C&par=yahoo

Large U.S. bank collapse seen ahead
http://www.reuters.com/article/newsOne/idUSSP21695020080819

Deepening economic crisis ‘may trigger family breakdown’
http://www.dailymail.c..onomic-crisis-trigger-family-breakdown.html

Auto industry seeks $50B in loans from Congress
http://money.cnn.com/2008/08/23/news/economy/auto_bailout.ap/index.htm

Living the American dream in Brazil
http://english.aljazeera.net/focus/2008/08/200881884358873790.html

Illegal Immigrants Returning to Mexico in Record Numbers
http://www.foxnews.com/story/0,2933,409221,00.html

FDIC: Highest Level Of Troubled Banks Since 2003
http://news.yahoo.com/s/ap/20..s;_ylt=AiX6b2alma.c4GBC5tc9LJqs0NUE

FDIC Increasing Staff for Expected Increase in Bank Failures
Japan’s Mitsubishi takes over US bank

U.S. Economic Collapse News Archive

 



8th U.S. Bank Failure This Year

8th U.S. Bank Failure This Year

Reuters
August 1, 2008

WASHINGTON (Reuters) – SunTrust Bank (STINews) has acquired the insured deposits of Florida-based First Priority Bank, the eighth U.S. bank to fail this year as financial institutions grapple with a weak economy and a credit crisis precipitated by falling home prices.

The Federal Deposit Insurance Corp said on Friday that Florida regulators closed the bank, which had $259 million in assets and $227 million in deposits. The FDIC was named receiver.

The cost of the failure to the federal insurance fund is estimated to be $72 million, the FDIC said.

 

FDIC warns four US banks over liquidity

Financial Times
August 1, 2008

The Federal Deposit Insurance Corporation revealed on Friday that it had issued warnings to four small US banks that lacked sufficient reserves to cover potential loan losses.

The cease-and-desist orders issued in June said the four banks needed to raise more capital, expand their loss allowances and better oversee and diversify their loan portfolios. A fifth bank was cited for violating consumer protection laws.

Losses on mortages and other loans have helped bring down eight US banks this year, including one small Florida institution on Friday. Last month, Indymac, a California lender with $32bn in assets, became one of the largest banks to go under in US history. It filed for Chapter 7 bankruptcy protection on Friday.

The banks receiving cease-and-desist orders in June were MetroPacific Bank in Irvine, California; Bank Haven in Haven, Kansas; Clarkston State Bank in Clarkston, Michigan; and Hastings State Bank in Hastings, Nebraska.

Read Full Article Here

 



Stressed banks borrow record amount from Fed

Stressed banks borrow record amount from Fed

Reuters
July 31, 2008

Banks borrowed a record amount of funds from the Federal Reserve in the latest week as the year old credit crisis took a persistent toll, while the commercial paper market continued to contract, signaling tough conditions for short term borrowers.

Banks’ primary credit borrowings averaged $17.45 billion per day in the latest week, the second straight week this had hit a record and up from $16.38 billion the previous week, Fed data showed on Thursday.

Read Full Article Here

 

Zimbabwe Devalues Currency

AP
July 30, 2008

Zimbabwe will drop 10 zeros from its hyper-inflated currency — turning 10 billion dollars into one — the country’s reserve bank said Wednesday. President Robert Mugabe threatened a state of emergency if businesses profiteer from the country’s economic and political unraveling.

Shop shelves are empty and there are chronic shortages of everything including medication, food, fuel, power and water. Eighty percent of the work force is unemployed and many who do have jobs don’t earn enough to pay for bus fare.

Read Full Article Here

 

Inverview with George Green – (7/16/2008)

http://video.google.com/videoplay?docid=7618947388652774139&hl=en

Recent News:

Bush signs housing bill in private
http://www.politico.com/news/stories/0708/12166.html

Soaring energy bills set to push inflation to 16-year high
http://www.dailymail.co.uk/news/ar..set-push-inflation-16-year-high.html

GM Has $15.5 Billion Loss on U.S. Sales Drop, Leases
http://www.bloomberg.com/apps/news?pid=20601087&sid=agMEuJ_r_yxA&refer=worldwide

Venezuela to Nationalize Spanish Bank
http://english.cri.cn/2947/2008/08/01/1821s388058.htm

IndyMAC Files For Bankruptcy Protection
http://www.nytimes.com/2008..2&ref=business&oref=slogin&oref=slogin

Jobless Claims Up Highest In Five Years
http://www.wnbc.com/news/17049831/detail.html

Inflation Could Hit 6% By Fall?
http://economictimes.indiatimes.com..Economist/articleshow/3307499.cms

Deutsche Bank Writedowns Exceed $11 Billion
http://moneynews.com/financenews/bank_writedowns/2008/07/31/117802.html

Shell reports 33% rise in profit
http://www.iht.com/articles/2008/07/31/business/31shellNEW.php

Exxon posts record $11.68 billion profit
http://money.cnn.com/2008/07/31/news/.._profits/?postversion=2008073109

Britons Skipping Meals Due To Money Worries
http://www.money.co.uk/article/100..-meals-due-to-money-worries.htm

IMF Calls For N. African Economic Integration
Greenspan: Housing No Where Near Bottom
Economic Rebound Not As Energetic As Hoped
Biggest dive for commodities in 28 years

U.S. Economic Collapse News Archive

 



FDIC Takes Over Two More Failed Banks

FDIC Takes Over Two More Failed Banks

AP
July 26, 2008

The 28 branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California, were closed Friday by federal regulators.

The banks, owned by Scottsdale, Ariz.-based First National Bank Holding Co., were scheduled to reopen on Monday as Mutual of Omaha Bank branches, the Federal Deposit Insurance Corp. said.

The FDIC said the takeover of the failed banks was the least costly resolution and all depositors – including those with funds in excess of FDIC insurance limits – will switch to Mutual of Omaha with “the full amount of their deposits.”

The FDIC also said accountholders can access their funds during the weekend by writing checks or using ATM or debit cards.

Read Full Article Here

 

Wachovia Joins the Financial Apocalypse

JBS
July 22, 2008

It’s beginning to look as if Fortis was right. In June the Belgium-Dutch financial giant, itself beset by financial woes, warned, according to a Dutch paper, that the “complete collapse of the U.S. financial markets” was in the offing, just days or weeks away.

Maybe it won’t be a “complete” collapse, but the dire warning is beginning to appear more credible daily. Just days after the Fortis warning, letters from Senator Charles Schumer speculating about the “possible collapse of big mortgage lender IndyMac Bancorp Inc.” set off a run on that ailing mortgage lender with depositors withdrawing more than $1.3 billion in just 11 days.

In the weeks since there has been increasing speculation about the stability of both the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). These holdovers from the Roosevelt Administration’s ill-conceived New Deal presently own or guarantee half of the $12 trillion U.S. mortgage market, yet they were characterized recently as “insolvent” by former Federal Reserve President William Poole.

In a free market, when you perform poorly your business might fail. But Poole, a consummate government regulator, thinks Fannie Mae and Freddy Mac are too big to fail. “Clearly they must be supported,” he said according to a July 11 Reuters report. “They (the U.S. government) cannot allow that amount of assets … to go into limbo.” In other words, according to Poole, the federal government must take money (a lot of money!) from some and give it to others. As economist Frederic Bastiat eloquently pointed out, that is socialism, the law run amok and turned on its head.

On top of IndyMac and Fannie and Freddie, the bad news from the financial sector keeps coming. On Tuesday, Wachovia Corp. reported striking losses totaling nearly $9 billion for the quarter. “Our reported results today are clearly a disappointing performance for which we take responsibility,” Wachovia CEO Bob Steel told analysts on a conference call. The nation’s fourth largest bank also noted that it would eliminate as many as 10,750 positions.

Read Full Article Here

WaMu Slumps as Gimme Credit Cites Liquidity Concern
http://www.bloomberg.com/apps/news?pid=20601110&sid=a3479q5QfJhw

Two Troubled U.S. Banks Post Big Losses
http://www.iht.com/articles/2008/07/22/business/bank.php

Bank Gave Counterfeit Bills, Couple Says
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8,500 Banks Will Fail
http://cryptogon.com/?p=2994

Evidence of the US Banking System Teetering on the Brink of Collapse
http://www.marketoracle.co.uk/Article5594.html

Paulson Says Banks Safe & Sound (liar)
http://business.timesonline.co.uk/../united_states/article4368749.ece

Arabs Buying Up Failing Western Banks
http://www.israelnationalnews.com/News/News.aspx/126866

 



Taxpayers Will Pay $800 BILLION For Failed Mortgage Lenders

Taxpayers Will Pay $800 BILLION For Failed Mortgage Lenders
House & Senate passes housing bailout bill H.R. 3221 (The American Housing Rescue & Foreclosure Prevention Act) by an overwhelming 272-152 vote, Bush will sign soon.

Youtube
July 24, 2008

Ron Paul talks about the bailout out of the housing industry and how it really just destroys the dollar and adds enormously to the debt.

Also, slipped into the bill, was the stipulation that ALL credit card transactions must now be reported to the IRS.

Details of today’s housing bill by Dr. Ron Paul:

-$2.5B line of credit to the Treasury (Fannie & Freddie – ‘F & F’) is now “open-ended”

  • UNLIMITED – Treasury now allowed to buy all ‘F & F’ housing securities
  • Congress no longer involved in appropriating funds (Treasury now does)

-National Debt Ceiling Moved up $800 BILLION (buried in the bill)

Treasury Bills being exchanged for unwanted ‘F & F’ securities

  • This is the asset which “backs up our currency”
  • Value of these assets are depreciating
  • Treasuries have replaced gold and silver to back US Dollar

– Solution breeds inflation

  • Places pressure on the US Dollar

-Mortgage industry workers “will now have to be fingerprinted.

All credit card transactions will now be reported to the IRS.

 

Housing bailout bill – another $800 billion gift from the taxpayer to Wall Street

Related News:

**RED ALERT** RAPE BY CONGRESS IMMINENT
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Investors worldwide are betting more than $1 trillion on a collapse in American stock prices
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Faber: Fannie, Freddie Should Not Get Aid
http://www.bloomberg.com/apps/n..&sid=a_L_tms03WSI&refer=home

Senate Passes Housing Bill
http://www.axcessnews.com/index.php/articles/show/id/16490

House OKs Fannie Freddie Bailout
http://news.yahoo.com/s/ap/200..Aujs0nZJn4G9TEm4v_o7vh.MwfIE

woman commits suicide as home foreclosed
http://www.norwichbulletin.com/new..suicide-as-home-foreclosed

Fannie and Freddie Own A Record $6.9 Billion Foreclosed Homes
http://www.economicpolicyjournal.co..d-freddie-own-record-69.html

U.S. Foreclosures Double
http://www.bloomberg.com/apps/news..87&sid=aomtw8.Pro2E&refer=home

IMF: U.S. Housing Overvalued By 20%
http://www.reuters.com/article/domesticNews/idUSN2542244220080726

California foreclosures up 261% from ‘07 levels
http://latimesblogs.latimes.com/laland/2008/07/cal-foreclosure.html

Freddie MAC CEO Paid $20 Million A Year
http://money.cnn.com/2008/0.._CEO.ap/index.htm?section=money_latest

Fannie, Freddie rescue pricetag could hit $25B
Housing report bruises Wall Street
Bank of China may hold huge US debt
Dems & Paulson Push Fannie/Freddie Bailout

 



Analysts Say More U.S. Banks Will Fail

Analysts Say More U.S. Banks Will Fail

IHT
July 14, 2008

As home prices continue to decline and loan defaults mount, U.S. regulators are bracing for dozens of American banks to fail over the next year.

But after a large mortgage lender in California collapsed late Friday, Wall Street analysts began posing two crucial questions: Just how many banks might falter? And, more urgently, which one could be next?

The nation’s banks are in far less danger than they were in the late 1980s and early 1990s, when more than 1,000 federally insured institutions went under during the savings-and-loan crisis. The debacle, the greatest collapse of American financial institutions since the Depression, prompted a government bailout that cost taxpayers about $125 billion.

But the troubles are growing so rapidly at some small and midsize banks that as many as 150 out of the 7,500 banks nationwide could fail over the next 12 to 18 months, analysts say. Other lenders are likely to shut branches or seek mergers.

“Everybody is drawing up lists, trying to figure out who the next bank is, No. 1, and No. 2, how many of them are there,” said Richard Bove, the banking analyst with Ladenburg Thalmann, who released a list of troubled banks over the weekend. “And No. 3, from the standpoint of Washington, how badly is it going to affect the economy?”

Many investors are on edge after federal regulators seized the California lender, IndyMac Bank, one of the nation’s largest savings and loans, last week. With $32 billion in assets, IndyMac, a spinoff of the Countrywide Financial Corporation, was the biggest American lender to fail in more than two decades.

Read Full Article Here

 



Police Threaten IndyMAC Customers With Arrest

Police Threaten IndyMAC Customers With Arrest

Daily News
July 15, 2008

Police ordered angry customers lined up outside an IndyMac Bank branch to remain calm or face arrest Tuesday as they tried to pull their money on the second day of the failed institution’s federal takeover.

At least three police squad cars showed up early Tuesday as tensions rose outside the San Fernando Valley branch of Pasadena-based IndyMac.

Federal regulators seized Pasadena-based IndyMac on Friday and reopened the bank Monday under the control of the Federal Deposit Insurance Corporation. Deposits to $100,000 are fully insured by the FDIC.

Worried customers with deposits in excess of insured limits flooded IndyMac Bank branches on Monday, demanding to withdraw as much money as they could or get answers about the fate of their funds.

When it was clear some wouldn’t get in before closing, FDIC employees apparently took down names and told them to return Tuesday.

Other customers began lining up at 1:30 a.m. Tuesday, and by dawn, tensions escalated because people on the list were getting priority.

By 8 a.m., about 50 people on the list waited in one line and many more waited in another.

Five people were allowed in at a time.

Customers became infuriated, and police told them they could be arrested if they didn’t remain calm.

Police stood by at some other branches around Southern California but there were no other reports of problems.

 

$1 Billion of uninsured deposits lost in IndyMAC collapse

Scared IndyMAC Customers Demand Their Cash
http://news.yahoo.com/s/ap/20080716/ap_..hV3SphAft82dzYRq61lv24cA

IndyMac depositors line up for cash after seizure
http://www.reuters.com/article/topNews/idUS..pNews&rpc=22&sp=true

FBI looking into fraud at IndyMac Bancorp
http://www.azcentral.com/news/artic..mortgage-investigation0716-ON.html

Merill Lynch Posts Loss Of $4.6 Billion
http://news.yahoo.com/s/afp/2..gVyF2eFsdB6zZUjUSc5tL2oOrgF

Bank Shares Plummet Amid Stability Fears
http://biz.yahoo.com/rb/080714/financial_shares.html?printer=1

Banks hit by fallout from the crisis at IndyMac
http://www.latimes.com/business/la-fi-indymac15-2008jul15,0,431088.story

List Of Troubled Banks Worries Wall Street
http://abcnews.go.com/Blotter/story?id=5374205

JP Morgan CEO: ’We’re very early in the loss curve’
http://www.housingwire.com/2008/07/..mon-prime-mortgages-look-terrible/