March 8 (Bloomberg) -- A Federal Deposit Insurance Corp. plan to auction more than $1 billion in assets seized from failed banks next month, including a loan to build a W Hotel in Atlanta, may trigger writedowns that weaken lenders nationwide.
Almost half of the loans were originated by Silverton Bank N.A., whose collapse last May was the biggest in Georgia history. Community banks that joined Silverton in providing $80 million for the 237-room hotel and condominium complex, as well as backing for 39 other projects, could be forced to write down their stakes to reflect sale prices.
The auctions may have wider repercussions. Of the $50.4 billion in loans seized from failed banks currently held by the FDIC, 63 percent involve participations by other lenders, according to data provided by agency spokesman Greg Hernandez.
“These banks can’t believe that the regulator they pay to protect them is going to sell these loans to someone who can flip them and cause them serious losses,” said Robert Reynolds, a lawyer at Reynolds Reynolds & Duncan LLC in Tuscaloosa, Alabama, who represents 25 lenders that took part in financing the W Hotel. “Our banks just cannot believe they’re being treated in a way that ultimately hurts the FDIC’s insurance fund, because some of them are right on the edge.”
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The title implies that 'Countrywide Bank' (B of A) is about to fail whereas I assume you meant 'country wide bank failure' is looming. (
ReplyDelete(Correct me if I'm wrong but I don't see that specific banking entity mentioned in the article.)
I'd correct that if I were you IMO real fast or expect a call from some legal beagle.
The hanky panky by the FDIC is this:
ReplyDeleteThe FDIC is actually serving private large interests, aka JP MOrgan/Chase and their shenanigans partners, Goldman Sacks and the SEC people plus a bunch of other richy rich types in government. They take the failed assets of the banks , GIVE THEM FOR PENNIES ON THE DOLLAR to Chase or some interim entity such as BOA (which ultimately will be consumed by Chase as well) and they gaurentee the bad debt at 1 to 1 , make the acquiring bank whole (which they didn't do to the bank they are closing, obviously enough) and then through various other hanky panky the acquiring bank makes big profit on the deal at the taxpayer expense while the properties are foreclosed and auctioned off then the original gaurentors are sued for the differance between the auction price and the original loan, meanwhile the bank already has been made whole on everything plus profit. It's just one huge gravy train for the banks inside the inner circle.
The FDIC exists at this point mainly to control and consumate the takeover of almost all small and mid sized banks in America into and under the Rockefellor umbrella of JP MOrgan Chase and Crew.
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ReplyDeleteto your forum. That’s one actually sweet post.
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