Comments on: When bankers make windfall profits from the FDIC http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: CRE_Views http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-21011 Tue, 16 Nov 2010 21:55:00 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-21011 The FDIC provides coverage or a guaranty to an acquiring bank for possible additional losses on the acquired, failed bank assets.

An FDIC “Indemnification Asset” represents the present value of the estimated losses on covered loans to be reimbursed by the FDIC based on the applicable terms of the Loss Sharing Agreement.

Despite the intent of “Loss Sharing” to bring order and calm to the commercial debt markets via long term asset management, some FDIC-assisted banks have raced to recognize and convert to cash loan impairments, liquidating assets as quickly as possible in order to be reimbursed by the FDIC for Loss Sharing losses.

In one of the rare instances of transparency into the Loss Sharing process as value proposition, we see that BankUnited “has received $863.3 million from the FDIC in reimbursements under the Loss Sharing Agreements for claims filed for losses incurred as of June 30, 2010″ and has at least $2.9 billion (in present value) to go.

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By: rcwhalen http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20711 Sat, 13 Nov 2010 03:13:50 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20711 Horsefeathers. You and Rob Cox do not get it. When you buy a dead bank for pennies on the dollar and then execute on the assets, you make a lot of money. But the profit is created by the receivership, not special deals. The liquidation of a bank is a terrible loss to shareholders, creditors, vendors, etc. The buyer of the dead bank’s assets gets a deal. There is nothing remarkable about BankUnited vs. many other resolutions. They all have this characteristic. Remember that Jamie Dimon paid three cents on the dollar for WaMu assets and the FDIC did not take a loss. Chris

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By: PPY http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20710 Sat, 13 Nov 2010 00:59:31 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20710 Why is hardly anyone paying attention to the FDIC and its abuse of power during the current financial crisis?

Why has most mainstream media outlets continued to praise the FDIC when the agency (reprimanded by its own Inspector General for being a poor regulator), through its reckless and capricious decision makings, ended up destroying thousands of jobs and wiped out billions of dollars in retirement investments and pension plans belonging to hardworking average Americans?

Oh well :(

*imho*

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By: PPY http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20709 Sat, 13 Nov 2010 00:37:36 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20709 Flowers’ group bid was higher…

“Flowers’s Higher Bid for BankUnited Assets Lost to Kansas Group”
http://www.bloomberg.com/apps/news?pid=n ewsarchive&sid=aJn7i1Vwnihw

*imho*

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By: y2kurtus http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20690 Fri, 12 Nov 2010 21:32:38 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20690 Oh dear… I ment that higher capital ratios would result in lower FDIC assements.

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By: y2kurtus http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20682 Fri, 12 Nov 2010 19:42:04 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20682 Best hopes for future FDIC assements to take into account things like:

Capital ratios (lower = lower assements)

Growth rates (Lower = lower assements)

CRA scores (Higher = lower assements)

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By: MarkWolfinger http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20611 Thu, 11 Nov 2010 16:14:59 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20611 I can accept that this is ever going to change.

However, the FDIC can retain 20% ownership of every such bank that it sells. Whether the shares are kept or dumped in an IPO isn’t the biggest point. But 20% would recoup a significant portion of the losses.

http://blog.mdwoptions.com

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By: kbemies http://blogs.reuters.com/felix-salmon/2010/11/11/when-bankers-make-windfall-profits-from-the-fdic/comment-page-1/#comment-20608 Thu, 11 Nov 2010 14:53:53 +0000 http://blogs.reuters.com/felix-salmon/?p=6086#comment-20608 Wall Street resented in the heartland, Felix?
Show me where.

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