Tuesday, June 17, 2008

Community Bank Troubles

by Tanta on 6/17/2008 08:31:00 AM

The LA Times has a good piece out this morning on California community banks and their RE/mortgage problems, particularly with construction loans. Among others, there is this:

Security Pacific Bancorp of West L.A. -- which resembles in name only the former L.A.-based banking giant acquired in 1992 by what is now Bank of America Corp. -- has written off millions in dud Inland Empire housing loans. In a recent order, the Federal Deposit Insurance Corp. and state regulators required Security Pacific, with $585 million in assets, to diversify its operations, cut off deadbeat clients and "determine that the lending staff has the expertise necessary to properly supervise construction loans."
Hoocoodanode that you needed expertise to supervise construction loans?

If you are interested, the Security Pacific C&D is here.