On 11 March and 12 March 2010, the Federal Deposit Insurance Corporation closed four banks: LibertyPointe Bank, New York, NY; Park Avenue Bank, New York, NY; Old Southern Bank, Orlando, FL; and Statewide Bank, Covington, LA. The assets of the closed banks were $1,288,600,000 and insured deposits were $1,232,500,000. The cost to the FDIC is estimated at $1,020,050,000. The closure data is available here, at the FDIC website.
According to our methodology, the recoverable value of the banks was only 79.16% of declared asset value. This makes the recoverability of this week's closures well above the cumulative recoverability since December of 2007, which stands at 57.68% (up sharply from 57.63%). This means that the failed banks' assets were worth approximately 79.16¢ on the dollar; overall, all closures since December of 2007 were worth approximately 57.68¢ on the dollar.
Cumulative cost to the FDIC to close all 191 banks (since December of 2007) was brought to $61,347,720,000. These closures bring the total declared assets of failed institutions to $562,753,780,000, and total FDIC-insured deposits to $385,967,840,000. The recoverable value of all failed banks was only $324,620,130,000 (57.68% of the declared value).
* * *
Stress in a State's banking system can be best seen in how costly that State's cumulative closures were to the FDIC. Below is the list of those States which likely have the most stressed banks, calculated by comparing that State's total FDIC cost of closures to their share of United States population. Only those States which have two or more closures are considered.
1. Alabama
2. Georgia
3. Nevada
4. California
5. Florida
6. Illinois
* * *
The recoverable value represents how much of declared assets are worth, by our estimate, on the open market. The following are the ten States with the lowest recoverable value, representing those States which have the most overvalued banking system assets. Only those States which have had two or more closures are considered in this analysis.
1. Florida (40.91%, up from 40.50%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.47%)
5. Nevada (50.22%)
6. Ohio (50.84%)
7. Washington (54.17%)
8. Georgia (55.33%)
9. North Carolina (56.70%)
10. Utah (58.13%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $1,020,050,000. The value now stands at $33,791,020,000. This is our estimate of how much money the FDIC has remaining from its special assessment of approximately $45 billion (click here to read the FDIC press release about the assessment). Every week since December of 2009, we subtract that week's cost of bank closures to the FDIC from the standing total.
Showing posts with label cash burn-through meter. Show all posts
Showing posts with label cash burn-through meter. Show all posts
Saturday, March 13, 2010
Wednesday, March 10, 2010
FDIC Bank Failure Report (05 March 2010)
On 26 February and 05 March 2010, the Federal Deposit Insurance Corporation closed six banks: Rainier Pacific Bank, Tacoma, WA; Carson River Community Bank, Carson City, NV; Sun American Bank, Boca Raton, FL; Bank of Illinois, Normal, IL; Waterfield Bank, Germantown, MD; and Centennial Bank, Ogden, UT. The assets of the closed banks were $1,887,100,000 and insured deposits were $1,497,490,000. The cost to the FDIC is estimated at $419,710,000. The closure data is available here, at the FDIC website.
According to our methodology, the recoverable value of the banks was only 57.11% of declared asset value. This makes the recoverability of this week's closures well below the cumulative recoverability since December of 2007, which stands at 57.63% (essentially unchanged from 57.64%). This means that the failed banks' assets were worth approximately 57.11¢ on the dollar; overall, all closures since December of 2007 were worth approximately 57.63¢ on the dollar.
Cumulative cost to the FDIC to close all 191 banks (since December of 2007) was brought to $61,735,260,000. These closures bring the total declared assets of failed institutions to $561,465,180,000, and total FDIC-insured deposits to $384,735,340,000. The recoverable value of all failed banks was only $323,600,080,000 (57.63% of the declared value).
* * *
Stress in a State's banking system can be best seen in how costly that State's cumulative closures were to the FDIC. Below is the list of those States which likely have the most stressed banks, calculated by comparing that State's total FDIC cost of closures to their share of United States population. Only those States which have two or more closures are considered.
1. Alabama
2. Georgia
3. Nevada
4. California
5. Florida
6. Illinois
* * *
The recoverable value represents how much of declared assets are worth, by our estimate, on the open market. The following are the ten States with the lowest recoverable value, representing those States which have the most overvalued banking system assets. Only those States which have had two or more closures are considered in this analysis.
1. Florida (40.50%, up from 39.95%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.47%)
5. Nevada (50.22%, up from 49.81%)
6. Ohio (50.84%)
7. Washington (54.17%, down from 55.25%)
8. Georgia (55.33%)
9. North Carolina (56.70%)
10. Utah, replacing Maryland (58.13%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $419,710,000. The value now stands at $34,811,070,000. This is our estimate of how much money the FDIC has remaining from its special assessment of approximately $45 billion (click here to read the FDIC press release about the assessment). Every week since December of 2009, we subtract that week's cost of bank closures to the FDIC from the standing total.
According to our methodology, the recoverable value of the banks was only 57.11% of declared asset value. This makes the recoverability of this week's closures well below the cumulative recoverability since December of 2007, which stands at 57.63% (essentially unchanged from 57.64%). This means that the failed banks' assets were worth approximately 57.11¢ on the dollar; overall, all closures since December of 2007 were worth approximately 57.63¢ on the dollar.
Cumulative cost to the FDIC to close all 191 banks (since December of 2007) was brought to $61,735,260,000. These closures bring the total declared assets of failed institutions to $561,465,180,000, and total FDIC-insured deposits to $384,735,340,000. The recoverable value of all failed banks was only $323,600,080,000 (57.63% of the declared value).
* * *
Stress in a State's banking system can be best seen in how costly that State's cumulative closures were to the FDIC. Below is the list of those States which likely have the most stressed banks, calculated by comparing that State's total FDIC cost of closures to their share of United States population. Only those States which have two or more closures are considered.
1. Alabama
2. Georgia
3. Nevada
4. California
5. Florida
6. Illinois
* * *
The recoverable value represents how much of declared assets are worth, by our estimate, on the open market. The following are the ten States with the lowest recoverable value, representing those States which have the most overvalued banking system assets. Only those States which have had two or more closures are considered in this analysis.
1. Florida (40.50%, up from 39.95%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.47%)
5. Nevada (50.22%, up from 49.81%)
6. Ohio (50.84%)
7. Washington (54.17%, down from 55.25%)
8. Georgia (55.33%)
9. North Carolina (56.70%)
10. Utah, replacing Maryland (58.13%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $419,710,000. The value now stands at $34,811,070,000. This is our estimate of how much money the FDIC has remaining from its special assessment of approximately $45 billion (click here to read the FDIC press release about the assessment). Every week since December of 2009, we subtract that week's cost of bank closures to the FDIC from the standing total.
Saturday, January 30, 2010
FDIC Bank Failure Report
On 29/01/10, the Federal Deposit Insurance Corporation closed six banks: First National Bank of Georgia, Carrollton, GA; Florida Community Bank, Immokalee, FL; Marshall Bank, N.A., Hallock, MN; Community Bank & Trust, Cornelia, GA; First Regional Bank, Los Angeles, CA; and American Marine Bank, Bainbridge Island, WA. The assets of the closed banks were $5,531,200,000 and insured deposits were $4,896,600,000. The cost to the FDIC is estimated at $1,875,760,000.
According to our methodology, the recoverable value of the banks was only 54.61% of the declared asset value. This makes the recoverability of this week's closures distinctly below the cumulative recoverability since December of 2007, which stands at 57.66% (down slightly from last report's 57.69%).
Cumulative cost-to-FDIC so far in the Depression was brought to $59,643,720,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $555,373,580,000, and total FDIC-insured deposits to $379,858,150,000. The recoverable value of all failed banks was only $320,214,430,000 (57.69% of the declared value).
* * *
Once again the FDIC has pulled out a new trick: this week is was an "equity appreciation instrument," taken as "consideration for the transaction" of Florida Community Bank. We assume this means stock. If we're right, then it is simply another method by which the FDIC is extending store credit to acquiring institutions. What makes the situation seem all the more strange, is that the acquirer of Florida Community was a bank which was formed just last week: Premier American Bank, N.A., which purchased the failed Premier American Bank, with a "cash participant instrument" in the transaction.
Hmm... We have not heard back from the FDIC on our enquiry about the terms of the cash participant instrument, so we cannot conjecture about what exactly is going on. In general, however, we have to seriously question what the hell the FDIC is thinking: it is not only extending credit, but extending it to a newly-formed bank in two different forms within two weeks, potentially involving upwards of $850 million in assets. If the FDIC gave generous credit to Premier American - for example, only 10% downpayment or so - that's a lot of leverage for an institution, whose predecessor showed itself less than reliable.
We will still try to get more information from the FDIC about these instruments thrown about recently. If we do get something useful, we'll try to make better sense of the situation.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Oregon
8. Missouri
9. Florida
10. Washington (replacing Arizona)
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (39.81%, up from 39.38%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.13%, up from 45.06%)
5. Nevada (49.81%)
6. Ohio (50.84%)
7. Washington (55.25%, up from 54.11%)
8. Georgia (55.33%, up from 54.64%)
9. North Carolina (56.70%)
10. Maryland (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $1,875,760,000. The value now stands at $36,302,620,000.
According to our methodology, the recoverable value of the banks was only 54.61% of the declared asset value. This makes the recoverability of this week's closures distinctly below the cumulative recoverability since December of 2007, which stands at 57.66% (down slightly from last report's 57.69%).
Cumulative cost-to-FDIC so far in the Depression was brought to $59,643,720,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $555,373,580,000, and total FDIC-insured deposits to $379,858,150,000. The recoverable value of all failed banks was only $320,214,430,000 (57.69% of the declared value).
* * *
Once again the FDIC has pulled out a new trick: this week is was an "equity appreciation instrument," taken as "consideration for the transaction" of Florida Community Bank. We assume this means stock. If we're right, then it is simply another method by which the FDIC is extending store credit to acquiring institutions. What makes the situation seem all the more strange, is that the acquirer of Florida Community was a bank which was formed just last week: Premier American Bank, N.A., which purchased the failed Premier American Bank, with a "cash participant instrument" in the transaction.
Hmm... We have not heard back from the FDIC on our enquiry about the terms of the cash participant instrument, so we cannot conjecture about what exactly is going on. In general, however, we have to seriously question what the hell the FDIC is thinking: it is not only extending credit, but extending it to a newly-formed bank in two different forms within two weeks, potentially involving upwards of $850 million in assets. If the FDIC gave generous credit to Premier American - for example, only 10% downpayment or so - that's a lot of leverage for an institution, whose predecessor showed itself less than reliable.
We will still try to get more information from the FDIC about these instruments thrown about recently. If we do get something useful, we'll try to make better sense of the situation.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Oregon
8. Missouri
9. Florida
10. Washington (replacing Arizona)
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (39.81%, up from 39.38%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.13%, up from 45.06%)
5. Nevada (49.81%)
6. Ohio (50.84%)
7. Washington (55.25%, up from 54.11%)
8. Georgia (55.33%, up from 54.64%)
9. North Carolina (56.70%)
10. Maryland (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $1,875,760,000. The value now stands at $36,302,620,000.
Wednesday, January 27, 2010
FDIC Bank Failure Report - Extra Late Edition
On 22/01/10, the Federal Deposit Insurance Corporation closed five banks: Premier American Bank, Miami, FL; Bank of Leeton, Leeton, MO; Charter Bank, Santa Fe, NM; Evergreen Bank, Seattle, WA; and Columbia River Bank, The Dalles, OR. The assets of the closed banks were $3,159,500,000 and insured deposits were $2,637,600,000. The cost to the FDIC is estimated at $546,210,000.
According to our methodology, the recoverable value of the banks were only 66.19% of the declared asset value. This makes the recoverability of this week's closures distinctly above the cumulative recoverability since December of 2007, which stands at 57.69% (up slightly from last report's 57.64%).
Cumulative cost-to-FDIC so far in the Depression was brought to $57,767,960,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $549,842,380,000, and total FDIC-insured deposits to $374,961,550,000. The recoverable value of all failed banks was only $317,193,590,000 (57.69% of the declared value).
* * *
We noticed with a handful of these latest closures, that the FDIC has "acquire[d] a cash participant instrument," adding that "[t]his instrument serves as additional consideration for the transaction." At present we assume this means the FDIC is providing financing for the acquiring bank; in essence, the Government is giving store credit for the assets of dead banks. How this is a good idea, we really don't know, but we can only assume the regulatory geniuses at the FDIC have a firm grasp on things.
If indeed the FDIC is extending store credit to acquirers, we posit this means the bank catastrophe in the United States has entered a new phase of... well, catastrophe. Not only did the assets of Evergreen and Premier American start rotting when exposed to oxygen, they were so horrible the FDIC had to give financing to get rid of the muck. "Here, take the assets for awhile and give them a try in your books," the regulators must have told the acquirers; "we're so confident you'll love them, you don't even have to give us a down-payment." If those acquiring bank had had any self-respect, they would have run away screaming.
Once again we can't help but to think that the FDIC is setting itself up for a world of hurt. By extending store credit - if indeed that is what the "cash participant instrument" is - the FDIC is betting that a recovery will help strengthen the acquiring institutions sufficiently, that sucking up the full cost of the filth they bought on credit will not, in turn, cause them to croak. Instead, we're quite convinced by this move that a major bank failure is in the works, whether or not the FDIC is aware of it. If bank assets have gotten to the point where they have to be force-fed, then there's a big bank out there loaded to the gunwales with toxic sludge. The questions are: which bank, and when? Alas, dear Reader, we have no answers.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Oregon (up from #9)
8. Missouri
9. Florida (down from #7)
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (39.38%, up from 38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Ohio, up from #7 (50.84%)
7. Washington, down from #6 (54.11%, up from 50.62%)
8. Georgia (54.64%)
9. North Carolina (56.70%)
10. Maryland (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $546,210,000. The value now stands at $38,178,380,000.
According to our methodology, the recoverable value of the banks were only 66.19% of the declared asset value. This makes the recoverability of this week's closures distinctly above the cumulative recoverability since December of 2007, which stands at 57.69% (up slightly from last report's 57.64%).
Cumulative cost-to-FDIC so far in the Depression was brought to $57,767,960,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $549,842,380,000, and total FDIC-insured deposits to $374,961,550,000. The recoverable value of all failed banks was only $317,193,590,000 (57.69% of the declared value).
* * *
We noticed with a handful of these latest closures, that the FDIC has "acquire[d] a cash participant instrument," adding that "[t]his instrument serves as additional consideration for the transaction." At present we assume this means the FDIC is providing financing for the acquiring bank; in essence, the Government is giving store credit for the assets of dead banks. How this is a good idea, we really don't know, but we can only assume the regulatory geniuses at the FDIC have a firm grasp on things.
If indeed the FDIC is extending store credit to acquirers, we posit this means the bank catastrophe in the United States has entered a new phase of... well, catastrophe. Not only did the assets of Evergreen and Premier American start rotting when exposed to oxygen, they were so horrible the FDIC had to give financing to get rid of the muck. "Here, take the assets for awhile and give them a try in your books," the regulators must have told the acquirers; "we're so confident you'll love them, you don't even have to give us a down-payment." If those acquiring bank had had any self-respect, they would have run away screaming.
Once again we can't help but to think that the FDIC is setting itself up for a world of hurt. By extending store credit - if indeed that is what the "cash participant instrument" is - the FDIC is betting that a recovery will help strengthen the acquiring institutions sufficiently, that sucking up the full cost of the filth they bought on credit will not, in turn, cause them to croak. Instead, we're quite convinced by this move that a major bank failure is in the works, whether or not the FDIC is aware of it. If bank assets have gotten to the point where they have to be force-fed, then there's a big bank out there loaded to the gunwales with toxic sludge. The questions are: which bank, and when? Alas, dear Reader, we have no answers.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Oregon (up from #9)
8. Missouri
9. Florida (down from #7)
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (39.38%, up from 38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Ohio, up from #7 (50.84%)
7. Washington, down from #6 (54.11%, up from 50.62%)
8. Georgia (54.64%)
9. North Carolina (56.70%)
10. Maryland (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $546,210,000. The value now stands at $38,178,380,000.
Tuesday, January 19, 2010
FDIC Bank Failure Report - Late Edition
On 15/01/10, the Federal Deposit Insurance Corporation closed three banks: Town Community Bank & Trust, Antioch, IL; St. Stephen State Bank, St. Stephen, MN; and Barnes Banking Company, Kaysville, UT.The assets of the closed banks were $922,100,000 and insured deposits were $877,300,000. The cost to the FDIC is estimated at $296,300,000.
According to our methodology, the recoverable value of the bank was only 63.01% of the declared asset value. This makes the recoverability of this week's closure distinctly above the cumulative recoverability since December of 2007, which stands at 57.64% (essentially unchanged from last report's 57.63%).
Cumulative cost-to-FDIC so far in the Depression was brought to $57,221,740,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $546,682,880,000, and total FDIC-insured deposits to $372,323,950,000. The recoverable value of all failed banks was only $315,102,210,000 (57.64% of the declared value).
* * *
We don't have much to say about these closures, other than to note that the FDIC was forced to create a Deposit Insurance National Bank to facilitate the liquidation of the failed Barnes Banking Company. What this means, of course, is that Barnes was so rank the FDIC could not possibly slather enough perfume on it to cover up the stench. No other institutions found Barnes to be agreeable as a dance partner, as it were, so the FDIC was left with the corpse. We suspect that Barnes' assets will end up in a future Multibank Structured Transaction, like the $1.02 billion of rotting assets recently auctioned off, for 22 cents on the dollar.
We'd love to see the entire U.S. banking system priced as realistically as that MST!
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota (up from #5)
5. Utah (up from #6)
6. Kansas (down from #4)
7. Florida
8. Missouri
9. Oregon
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Washington (50.62%)
7. Ohio (50.84%)
8. Georgia (54.64%)
9. North Carolina, up from #10 (56.70%)
10. Maryland, new to list (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $296,300,000. The value now stands at $38,724,590,000.
According to our methodology, the recoverable value of the bank was only 63.01% of the declared asset value. This makes the recoverability of this week's closure distinctly above the cumulative recoverability since December of 2007, which stands at 57.64% (essentially unchanged from last report's 57.63%).
Cumulative cost-to-FDIC so far in the Depression was brought to $57,221,740,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $546,682,880,000, and total FDIC-insured deposits to $372,323,950,000. The recoverable value of all failed banks was only $315,102,210,000 (57.64% of the declared value).
* * *
We don't have much to say about these closures, other than to note that the FDIC was forced to create a Deposit Insurance National Bank to facilitate the liquidation of the failed Barnes Banking Company. What this means, of course, is that Barnes was so rank the FDIC could not possibly slather enough perfume on it to cover up the stench. No other institutions found Barnes to be agreeable as a dance partner, as it were, so the FDIC was left with the corpse. We suspect that Barnes' assets will end up in a future Multibank Structured Transaction, like the $1.02 billion of rotting assets recently auctioned off, for 22 cents on the dollar.
We'd love to see the entire U.S. banking system priced as realistically as that MST!
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no weighting with assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota (up from #5)
5. Utah (up from #6)
6. Kansas (down from #4)
7. Florida
8. Missouri
9. Oregon
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Washington (50.62%)
7. Ohio (50.84%)
8. Georgia (54.64%)
9. North Carolina, up from #10 (56.70%)
10. Maryland, new to list (56.90%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $296,300,000. The value now stands at $38,724,590,000.
Sunday, January 10, 2010
FDIC Bank Failure Report
On 8/01/10, the Federal Deposit Insurance Corporation rang in the New Year closing one bank: Horizon Bank of Bellingham, Washington.The assets of the closed bank were $1,300,000,000 and deposits were $1,100,000,000. The cost to the FDIC is estimated at $539,100,000.
According to our methodology, the recoverable value of the bank was only 43.15% of the declared asset value. This makes the recoverability of this week's closure distinctly below the cumulative recoverability since December of 2007, which stands at 57.63% (down slightly from last report's 57.66%).
Cumulative cost-to-FDIC so far in the Depression was brought to $56,923,690,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $545,760,780,000, and total FDIC-insured deposits to $371,446,650,000. The recoverable value of all failed banks was only $314,522,960,000 (57.63% of the declared value).
* * *
It appears Santa Claus has not fixed the US banking system, after all. This week's closed bank was a particularly putrid affair and we consider it a bad omen for the rest of the year.
The Federal Reserve system laid a sulfurous egg this week too, announcing that bank consumer lending is declining at an 8 1/2 percent annual rate as of November. Revolving credit, primarily credit card lending is declining at a whopping annual rate of 18.5 percent! There is clearly no recovery in bank lending. We suspect that is in part due to the sorry state of household finances, but more so due to the utter insolvency of the banking system as a whole. The credit unions and banks out there that are still solvent enough to lend just cannot pick up the slack from the collapse of the system.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no account of assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Kansas
5. Minnesota
6. Utah
7. Florida
8. Missouri
9. Oregon
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Washington, up from #9 (50.62% down from 56.18%)
7. Ohio (50.84%)
8. Georgia (54.64%)
9. Utah (55.45%)
10. North Carolina (56.70%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $539,100,000. The value now stands at $39,020,890,000.
According to our methodology, the recoverable value of the bank was only 43.15% of the declared asset value. This makes the recoverability of this week's closure distinctly below the cumulative recoverability since December of 2007, which stands at 57.63% (down slightly from last report's 57.66%).
Cumulative cost-to-FDIC so far in the Depression was brought to $56,923,690,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $545,760,780,000, and total FDIC-insured deposits to $371,446,650,000. The recoverable value of all failed banks was only $314,522,960,000 (57.63% of the declared value).
* * *
It appears Santa Claus has not fixed the US banking system, after all. This week's closed bank was a particularly putrid affair and we consider it a bad omen for the rest of the year.
The Federal Reserve system laid a sulfurous egg this week too, announcing that bank consumer lending is declining at an 8 1/2 percent annual rate as of November. Revolving credit, primarily credit card lending is declining at a whopping annual rate of 18.5 percent! There is clearly no recovery in bank lending. We suspect that is in part due to the sorry state of household finances, but more so due to the utter insolvency of the banking system as a whole. The credit unions and banks out there that are still solvent enough to lend just cannot pick up the slack from the collapse of the system.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no account of assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Kansas
5. Minnesota
6. Utah
7. Florida
8. Missouri
9. Oregon
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (38.89%)
2. Colorado (42.80%)
3. Michigan (43.53%)
4. California (45.06%)
5. Nevada (49.81%)
6. Washington, up from #9 (50.62% down from 56.18%)
7. Ohio (50.84%)
8. Georgia (54.64%)
9. Utah (55.45%)
10. North Carolina (56.70%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $539,100,000. The value now stands at $39,020,890,000.
Wednesday, December 9, 2009
FDIC Bank Failure Report - Insanely Late Edition
This past weekend, the Federal Deposit Insurance Corporation closed six banks: Buckhead Community Bank of Atlanta, Georgia; First Security Bank of Norcross, Georgia; Tattnall Bank of Reidsville, Georgia; AmTrust Bank of Cleveland, Ohio; Benchmark Bank of Aurora, Illinois; and Greater Atlantic Bank of Reston, Virginia. The total assets of the closed bank were $13,424,600,000, and total deposits were $9,368,300,000. The cost to the FDIC is estimated at $2,386,400,000.
According to our methodology, the recoverable value of the banks were $6,981,900,000, or only 52.01% of the declared asset value. This makes this week's closures distinctly below the cumulative recoverability since December of 2007, which stands at 57.56% (down from last report's 57.70%).
Cumulative cost-to-FDIC so far in the Depression was brought to $53,886,900,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $529,028,280,000, and total FDIC-insured deposits to $358,374,220,000. The recoverable value of all failed banks was only $304,487,320,000 (57.56% of the declared value).
* * *
As if to make up for the prior two weeks, the FDIC went to town. Following its usual pattern, it muted the failure of a moderately large regional bank - AmTrust - by closing it along with several smaller banks. AmTrust was a particularly sad case with a recoverable value according to our method of only 50% of assets. It had been on a death watch for over a year having received a cease-and-desist order from the Office of Thrift Supervision in the fall of 2008. One wonders how much extra the FDIC's dithering cost the Deposit Insurance Fund.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no account of assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Missouri
8. Oregon
9. Florida
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (36.13%)
2. California (42.43%)
3. Colorado (42.76%)
4. Michigan (43.18%)
5. Nevada (50.13%)
6. Ohio (50.91%) - new to the list due to now having two closures
7. Georgia (54.75% up from 53.79%)
7. Utah (55.39%)
8. Arizona (56.08%)
9. Washington (56.18%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $2,386,400,000. The value stands at $41,600,600,000.
According to our methodology, the recoverable value of the banks were $6,981,900,000, or only 52.01% of the declared asset value. This makes this week's closures distinctly below the cumulative recoverability since December of 2007, which stands at 57.56% (down from last report's 57.70%).
Cumulative cost-to-FDIC so far in the Depression was brought to $53,886,900,000. These closures bring the total declared assets of FDIC-failed banks (since December of 2007) to $529,028,280,000, and total FDIC-insured deposits to $358,374,220,000. The recoverable value of all failed banks was only $304,487,320,000 (57.56% of the declared value).
* * *
As if to make up for the prior two weeks, the FDIC went to town. Following its usual pattern, it muted the failure of a moderately large regional bank - AmTrust - by closing it along with several smaller banks. AmTrust was a particularly sad case with a recoverable value according to our method of only 50% of assets. It had been on a death watch for over a year having received a cease-and-desist order from the Office of Thrift Supervision in the fall of 2008. One wonders how much extra the FDIC's dithering cost the Deposit Insurance Fund.
* * *
On the basis of the ratio of bank closures to population (i.e. simply the number of failures in each State, with no account of assets or deposits), the ten most afflicted States are listed here. Only those States which have two or more closures are considered.
1. Georgia
2. Nevada
3. Illinois
4. Minnesota
5. Utah
6. Kansas
7. Missouri
8. Oregon
9. Florida
10. Arizona
The recoverable value represents how much of declared assets are worth by our estimate on the open market. The following are the ten States with the lowest recoverable value; only those States which have had two or more closures are considered in this analysis.
1. Florida (36.13%)
2. California (42.43%)
3. Colorado (42.76%)
4. Michigan (43.18%)
5. Nevada (50.13%)
6. Ohio (50.91%) - new to the list due to now having two closures
7. Georgia (54.75% up from 53.79%)
7. Utah (55.39%)
8. Arizona (56.08%)
9. Washington (56.18%)
* * *
The Frugal Scotsman's FDIC Cash Burn Through O'Meter gets adjusted with a subtraction of $2,386,400,000. The value stands at $41,600,600,000.
Friday, November 13, 2009
FDIC Prepayment Approved
The Board of Directors of the FDIC has approved the three-year prepayment of deposit insurance premiums. According to the FDIC's press release, the prepayment will amount to about $45 billion, to be collected between now and December 30th, 2009. A quote from the press release:
To translate: the DIF's present balance is more or less zero, and the $45 billion is going to be shovelled out the door very quickly indeed. If the FDIC's bank closures cost around $1 billion per week, we fully expect this prepayment will be burned through in about 45 weeks or so. At that point, the FDIC will have its bank against the wall: it will have no further regular income from assessments until 2013, and 'special assessments' will become quickly onerous to a failing banking system. When that happens, the FDIC will have to either tap its lines of credit, or look for a direct bailout from the Federal Reserve or the U.S. Treasury.
But at any rate, we're pleased to introduce the Cash Burn-Through Meter; you will find it on the left, at the top of the menus. We will start the Meter at $45 billion, and with every week's closures we will subtract that value from the total prepayment. When it reaches zero we will buy a bottle of champagne.
The pre-payment allows the FDIC to strengthen the cash position of the Deposit Insurance Fund (DIF)... While the prepayment will immediately improve the FDIC's liquidity, it will not have an impact on the fund balance.
To translate: the DIF's present balance is more or less zero, and the $45 billion is going to be shovelled out the door very quickly indeed. If the FDIC's bank closures cost around $1 billion per week, we fully expect this prepayment will be burned through in about 45 weeks or so. At that point, the FDIC will have its bank against the wall: it will have no further regular income from assessments until 2013, and 'special assessments' will become quickly onerous to a failing banking system. When that happens, the FDIC will have to either tap its lines of credit, or look for a direct bailout from the Federal Reserve or the U.S. Treasury.
But at any rate, we're pleased to introduce the Cash Burn-Through Meter; you will find it on the left, at the top of the menus. We will start the Meter at $45 billion, and with every week's closures we will subtract that value from the total prepayment. When it reaches zero we will buy a bottle of champagne.
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