Bank failure Thursday

March 12, 2010

Generally you don’t see midweek failures unless everyone’s taking Friday off.

From AP:

The bank catered largely to the Orthodox Jewish community in Manhattan and Brooklyn….The bank was closed by New York state’s banking regulators and the FDIC appointed as receiver on Thursday, rather than on Friday as is customary for bank shutdowns because of the Jewish Sabbath falling at sundown Friday into Saturday.

#27

—Failed bank: LibertyPointe Bank, NY NY
—Regulator: New York State Banking Department
—Acquiring bank: Valley National Bank, Wayne NJ
—Vitals: at 12/31, assets of $209.7 million, deposits of $209.5 million
—Estimated DIF damage: $24.8 million

The last Thursday closures were on July 2nd, 2008, when seven were shuttered. July 3rd everyone had off, including FDIC.

Before that BankUnitedwas closed on  May, 21. And before BKUNA was WaMu, which was seized Sept 25, 2008.

3 comments

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In 2009, FDIC closed the BankUnited FSB on Thursday…exception to Friday closures.
Now we have LibertyPointe Bank on Thursday.

Check all the bank failures at :
http://portalseven.com/banks/

Posted by portalseven | Report as abusive

Rolfe –

We need an intervention here! I have tremendous respect for you and your writing!

Your colleague Felix is just getting completely reckless in his posts.

Writing on credit default swaps yesterday, he says:
“Indeed, it’s the long-only investors who are on the other side of the trade — institutional investors who wrote CDS rather than buying bonds, because the yield was higher or because they simply couldn’t locate bonds to buy, or just because CDS are more liquid. For those investors, CDS are bond substitutes, and they’ll buy a CDS for the full cash value of the amount being protected, just as they would a bond. They’re not leveraged.”

This is a provably false statement, backed up with not a shred of evidence. The extraordinary leverage in the CDS market is proof that counterparties are massively leveraged.

Another powerful statement he makes is
“Today, there isn’t a company in the world — not even Berkshire Hathaway — which can write CDS protection without having to put up collateral. ”

Is this true? What evidence is there? How does Felix know if this is a true statement?

Countless millions of people are still suffering the effects of the last crisis in which these instruments played a role. Inaccurate reporting in this arena impacts lives and contributes to this suffering.

Posted by DanHess | Report as abusive

Correction, the extraordinary *size* of the CDS market is proof of its leverage and evidence that Felix’s statement was false.

Posted by DanHess | Report as abusive