Bank Death Watch: Five failures + new addition

July 31, 2009

There were five bank failures tonight.  Two of meaningful size, but none in Georgia!

We’re still waiting on two big fish, however, Guaranty and Corus.  In an SEC filing today, Corus said it was “critically undercapitalized” with Tier 1 Capital of $157 million.  They also admitted is was “highly unlikely” they’d be able to raise capital, so FDIC seizure is a matter of when, not if.  Next Friday may be the day. (ht CR)

And we have a new addition to the Bank Death Watch list: Colonial BancGroup, which late today expressed doubt it can continue as a going concern.  With $26.4 billion of assets and $24.6 billion of deposits as of March 31st, it’s larger than Corus and Guaranty put together.

#65

  • Failed Bank:  First State Bank of Altus, Altus OK
  • Acquiring Bank: Herring Bank, Amarillo TX
  • Vitals: At 6/19/09, assets of $103.4m, deposits of $98.2m
  • DIF Damage: $25.2m

#66

  • Failed Bank:  Integrity Bank, Jupiter FL
  • Acquiring Bank: Stonegate Bank, Ft. Lauderdale FL
  • Vitals: At 6/5/09, assets of $119m, deposits of $102m
  • DIF Damage: $46m

#67

  • Failed Bank:  People’s Community Bank, West Chester OH
  • Acquiring Bank: First Financial Bank NA, Hamilton OH
  • Vitals: At 3/31/09, assets of $705.8m, deposits of $598.2m
  • DIF Damage: $129.5m

#68

  • Failed Bank:  First Bankamericano, Elizabeth NJ
  • Acquiring Bank: Crown Bank, Brick NJ
  • Vitals: At 7/16/09, assets of $166m, deposits of $157m
  • DIF Damage: $15m

#69

  • Failed Bank:  Mutual Bank, Harvey IL
  • Acquiring Bank: United Central Bank, Garland TX
  • Vitals: At 7/16/09, assets of $1.6b, deposits of $1.6b
  • DIF Damage: $696m
Comments

While I understand the FDIC has limited resources and some delay is necessary to allow for the orderly closure of insolvent institutions this dribbling out of a half dozen or so banks EVERY Friday seems more a political convenience than a logistical one.

I cannot believe Integrity Bank et al suddenly became insolvent over the past 7 days. Why doesn’t the FDIC move with more alacrity and clean up the dead wood in the system instead of this slow dribbling out of failed banks?

Posted by sangellone | Report as abusive
 

Wow… I really didn’t see Colonial getting this far.

I thought they had a capital infusion lined up, and that would clear the way for them to receive TARP? I’ll look into it.

Posted by Andrew | Report as abusive
 

So much for the equity injection… agreement terminated.

And why wouldn’t they terminate it? 12% non performing loans?

Posted by Andrew | Report as abusive
 

Rank the danger banks by order of dangerousity:

1) Corus
2) Guaranty

First two are easy. Negative equity is as negative equity does.

3) First Fed. 4.8% Tier 1 and falling fast. Almost no business activity, total exposure to CA residential mortgage market.

4) Colonial Bank. Ouch. Millstone exposure to RE (residential and commercial) in SE USA, and equity infusion yank out from underneath.

5) Flagstar? Not a lot of conviction around this one. Still generating margin writing new loans, non performing assets seem to have leveled off, and just got equity infusion but big time exposure to mortgages in all the wrong places (CA, FL, GA, NV, MI) and only good but not great T1 now (7.2%) makes you wonder what happens next Q when no new capital flows in.

Posted by Andrew | Report as abusive
 

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