Friday, August 01, 2008

Another Bank Failure... Well its Friday!

Hattip Calculatedrisk

FDIC report

Note: Previous article is an update on Case-Shiller.

"First Priority Bank, Bradenton, Florida, was closed today by the Commissioner of the Florida Office of Financial Regulation, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with SunTrust Bank, Atlanta, Georgia, to assume the insured deposits of First Priority."

Anyone else notice a pattern in the receiving banks? They're never the one's the bloggers are wondering if they could survive through 2009.

Personal comment: Its going to be ho-hum until another midsize or larger institution fails. While its not yet COB here on the West Coast, I expect no more failures today (there are no indications of mass food orders for after hours work at the FDIC... that I saw blogged).

Conveniently, the FDIC has had banking law changed to make it easier to take over LARGE institutions: From the discussion thread on CR.
Sheila and Ben' Love Child writes:
commented out bank name is to big to fail until the removal of the Federal Reserve Act's Rule 10B requested from the FDIC presented in the Housing Bill.

"The exemption in the new law, which was requested by the FDIC without objection by the Fed's Board of Governors, was aimed at making clear that once banks are taken over by the FDIC, capital rules no longer apply because they are effectively owned, operated and in liquidation by the government."

NOTE: I do not expect a big bank failure in August. After that... almost certainly. Until then, its going to be a string of banks that you and I probably aren't that familiar with going by the wayside.

Got Popcorn?

1 comment:

bug said...

Many large banks have been closed and to Pay off Credit Debt owed by these banks the government has stepped in which is a good sign considering the grim situation these financial institutions were in.