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should I panic or not yet
Another one bites the dust.
FP.
Miami Valley Bank, NetBank, and who was the third?
Metropolitan Savings Bank, Pittsburgh, PA
I am sure we will be returning frequently to this list in the future: FDIC: Failed Bank List
Ohio, Michigan and Florida have to be full of small bank failure candidates. These are the 7th, 8th and 4th ranked states by population, and they are well into recession already.
It's time for a Bank-Implode-O-Meter.
We will need another list for the Thrifts.
Conservatorship has bankers shaking heads | Northern Colorado Business Report
This caught my eye:
The FDIC said Miami Valley had about $14 million in 269 deposit accounts that exceeded the $100,000 deposit insurance limit.
That's about 20% of total deposits--is it common for banks to have such a high percentage of uninsured deposits? Or is this an aberration because the bank is so small?
534 institutions failed in 1989. Hope it doesn't get that bad again.
FDIC: HSOB Bank & Thrift Failures - Summary Report
Status of Market Street, a mortgage lender that was owned by NetBank:
Business: Market Street remains in limbo
Banking experts - a question . . . Has the repeal of Glass Stegal contributed to the current fiasco? It seems that happened a few years back about the time this mess started.
OT: Lawrence Yun is servin' up the Kool-Aid!
Realtors' Economist Expects Spring Turnaround
Mark - from the last thread:
Hmm.
This might help:
The US House of Representatives today approved legislation that would permanently eliminate taxes on people who have their mortgage debt canceled.
The House approved the bill by a 386-27 vote, over some Republican complaints that the tax elimination would be offset by new taxes on people with second homes. Republicans tried unsuccessfully to reconsider getting rid of this new tax as part of the bill.
Under current law, cancelled mortgage debt on primary residences counts as taxable income. But the bill passed today, the Mortgage Forgiveness Debt Relief Act, would allow borrowers to avoid this tax hit as long as the debt forgiven by a bank is debt on a primary residence.
The Bush administration has said it wants this tax relief to be temporary, and warned earlier this week that it would seek changes to the bill as it moves through Congress. The bill next has to be approved by the Senate, where a similar bill is expected to be introduced soo
Well on the one hand, the Glass Stegal Act was designed to prevent a repeat of the 1929-33 financial system meltdown, so to the extent that there are a number of parallels between the financial system of the late 1920's and today, its repeal has been a contributing factor to the current mess. On the other hand, the current mess isn't really the result of too much mixing of banking and investment banking activities, but rather the explosion of poorly understood derivatives and moving a large swath of the financial system beyond the reach of regulators period.
SPAIN - A BIG developer fails!
The Valencia property developer Llanera has become the first high-profile victim of the credit crunch in Spain, declaring insolvency yesterday after failing to meet payments on 748m of debt...
Sub-prime claims Spanish developer - Telegraph
Good article. Thanks FF
My wife and I traveled thru southern Spain during September. I was amazed at the number of cranes everywhere. There was a lot of construction going on where we traveled.
Valencia was my favorite city though. Reasonably priced and friendly with a huge park where the river was and wonderful beaches and harbor.
We traveled thru a Portugal, France, Italy, Switzerland and into Holland and saw nothing like the activity we saw in Spain anywhere else.
At some time in the future, you will be able to get a nice new apartment in Spain cheap as in Florida, Las Vegas, Phoenix and other places.
Under current law, cancelled mortgage debt on primary residences counts as taxable income. But the bill passed today, the Mortgage Forgiveness Debt Relief Act, would allow borrowers to avoid this tax hit as long as the debt forgiven by a bank is debt on a primary residence.
Even if the debt was from a HELOC and was used for an H2 and a vacation?
Even if the debt was from a HELOC and was used for an H2 and a vacation?
The money was already tax free to begin with. If the homeowner had sold the home at the peak, paid off the HELOC, there wouldn't have been any additional taxes due.
This isn't going to have a huge impact. If you're insolvent, you're already exempt from the taxes. This just reduces the paperwork.
Of course, I'm guessing there is one guy, somewhere, who is upside down on his home, has substantial assets, a bank that is willing to do a short sales and not pursue a deficiency judgment. I'm guessing he'd be pretty happy to hear this.
I'm surprised that Congress would willingly give up a revenue stream. I mistakenly assumed they wouldn't get this far until tax receipts were pinched. Oh well.
On the brighter side, this ought to help speed up the crash.
Next Monday is a bank holiday which gives FDIC more time to complete the transaction before opening Tuesday. I'm sure they are stretched thin from the recent NetBank closing.
NetBank update
Market Street remains in limbo - potential sale falls through...
Business: Market Street remains in limbo
The FDIC said Miami Valley had about $14 million in 269 deposit accounts that exceeded the $100,000 deposit insurance limit.
Huh? $14,000,000 / 269 accounts = $52,044 per account. That's well within the $100,000 FDIC deposit insurance limit.
Huh? $14,000,000 / 269 accounts = $52,044 per account. That's well within the $100,000 FDIC deposit insurance limit.
Um, that's the excess of those 269 accounts over the limit? For a long time retiree with net pension income who keeps rolling over the CDs, it's not hard to go over the limit. Banks do watch for this, and will warn you, but they can't really tell you to take your money elsewhere. That's the sad irony here; many of those depositors considered safety paramount, far more important than return. And they wanted the simplicity of having it 'all together', at the small bank that they had been a customer of, for decades.
The FDIC has a little cash to bail out depositors.
However, a lot of its accumulated premiums are "invested" "intragovernmental debt".
Just like the Social Security Trust Fund.
Where does the FDIC go to sell its holdings of that debt to raise cash.
Rheotorical question, BB will run the presses............
It's a good thing everything is contained or bank failures might worry me...
unusual closing a bank on a thursday. there must have been a liquidity event to cause it. probably not likethe lines at blackrock, but the bank is in a small town. locals know something is up when the fdic liquidators start showing up at hotels and restaurants and head to the bank. they typically will register at hotel under alias company name, but paying with the goovernment cc can blow the cover.