by Calculated Risk on 11/13/2010 09:15:00 AM

The monthly euro finance minister meeting is Tuesday in Brussels. That is probably the next key date ...

A few excerpts from the Irish Times: Government campaigns to avoid EU financial bailout

THE GOVERNMENT is campaigning to avert the threat of being forced to seek emergency fiscal aid from the EU authorities as it battles a drastic loss in investor confidence.
...
Two well-placed sources told The Irish Times, however, that Irish officials have been involved in ‘‘technical’’ discussions about the procedures to be followed in the event of any aid application being made to the European Financial Stability Facility (EFSF).

by Calculated Risk on 11/12/2010 11:59:00 PM

Note: this is an unofficial list of Problem Banks compiled only from public sources.

Here is the unofficial problem bank list for Nov 12, 2010.

Changes and comments from surferdude808:

Despite failures, the Unofficial Problem Bank List continued its rise to the 900 level. This week the list count finished at 898 after six additions and two removals. Assets total $418.5 billion, up from $416.5 billion last week.

After three down trending weeks in October, some readers wondered if the list had peaked. After this pause, the Unofficial Problem Bank List has added a net 27 institutions and $16.4 billion of assets since October 22nd.

Removals are two of this week’s failures -- Darby Bank & Trust Co., Vidalia, GA ($690 million) and Copper Star Bank, Scottsdale, AZ ($204 million).

Additions include Atlantic Coast Bank, Waycross, GA ($901 million Ticker: ACFC); The Leaders Bank, Oak Brook, IL ($659 million); NewDominion Bank, Charlotte, NC ($535 million); Middlesex Federal Savings, F.A., Somerville, MA ($389 million); Community Bank of Oak Park River Forest, Oak Park, IL ($364 million); and First Federal Savings and Loan Association of Pekin, Pekin, IL ($28 million).

We applaud the Illinois State Banking Department for the timely disclosure of its enforcement actions. Next week, we anticipate the OCC will release its actions for October, which will likely push the list count over 900.

by Calculated Risk on 11/12/2010 07:29:00 PM

Tarnished Copper Star
Fed burnishing to return
Like a bad penny.
by Soylent Green is People
From the FDIC: Stearns Bank National Association, St. Cloud, Minnesota, Assumes All of the Deposits of Copper Star Bank, Scottsdale, Arizona

As of September 30, 2010, Copper Star Bank had approximately $204.0 million in total assets and $190.2 million in total deposits. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $43.6 million. ... Copper Star Bank is the 146th FDIC-insured institution to fail in the nation this year, and the fourth in Arizona.

Three down today so far ...

by Calculated Risk on 11/12/2010 06:41:00 PM

From Bloomberg: Ireland Urged by European Officials to Accept Aid to Contain Debt Crisis

In a conference call of European Central Bank officials around noon Frankfurt time today, Ireland was pressed to seek outside help within days, the person said on condition of anonymity. Separately, a European Union official said a request for assistance was likely ...

However, earlier from the Irish Times: Cowen denies reports of EU talks on emergency funding

Taoiseach Brian Cowen has denied reports that negotiations are going on behind the scenes for emergency funding for Ireland from the European Union.

Quoting an unnamed source, the Reuters news agency reported that Ireland was likely to become the second euro zone country, after Greece, to obtain an international rescue.

Conflicting news reports continue ... reminds me of when Sunday was the new Monday (with all the breaking news during the crisis).

by Calculated Risk on 11/12/2010 06:09:00 PM

Stacking failed banks
One on top of another
To the moon, Alice!
by Soylent Green is People
From the FDIC: Ameris Bank, Moultrie, Georgia, Acquires All of the Deposits of Two Georgia Institutions

As of September 30, 2010, Tifton Banking Company had total assets of $143.7 million and total deposits of $141.6 million, and Darby Bank & Trust Co. had total assets of $654.7 million and total deposits of $587.6 million.
...
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $24.6 million for Tifton Banking Company, and $136.2 million for Darby Bank & Trust Co. ... The two closed institutions were the 144th and 145th banks to fail in the nation this year, and the 17th and 18th banks to close in Georgia.

More Georgia ...

by Calculated Risk on 11/12/2010 04:11:00 PM

A few excerpts from home builder D.R. Horton's conference call:

CEO Don Tomnitz:

As we look to fiscal 2011, we ... expect another very challenging year for the homebuilding industry, as the fundamental drivers of demand, the overall economy, job growth, and consumer confidence are still very weak. In addition, we do not expect any stimulus in fiscal 2011 similar to the federal tax credits that were in effect last year.

All of these factors make it likely that our sales and closing volumes will be below our volumes in fiscal 2010.

And from the Q&A:

Based on current sales demand and the fact that the tax credits were supporting sales demand last year, we expect sales in the next two quarters to be lower than last year.
...
There are still challenges in the homebuilding industry. Rising foreclosures, significant existing home inventory, high unemployment, tight mortgage lending standards, and the weak consumer confidence ... the real key is that the traffic count in our sub-divisions is down, and I don’t think there is a lot of pricing adjustment that we can do, it’s just a function of the lack of traffic. So until there is some consumer confidence, until we start to grow jobs, I think we’re going to continue to be faced with rather flat demand just simply because buyers don’t feel confident about the future and they’re not going out there looking for a house in the numbers that they were certainly when the tax credits were there.

Until the excess housing inventory is absorbed, the home builders will be under pressure. There is still a long way to go ...

by Calculated Risk on 11/12/2010 12:50:00 PM

Just an update since I've been following this over the last few weeks ... the EU finance ministers issued a statement last night that pushed down the yields for Ireland and Portugal debt:

Whatever the debate within the euro area about the future permanent crisis resolution mechanism, and the potential for private sector involvement in that mechanism, we are clear that this does not apply to any outstanding debt and any programme under current instruments.

Any new mechanism would only come into effect after mid-2013 with no impact whatsoever on the current arrangements.

The EFSF (European Financial Stability Facility) is already established and its activation does not require private sector involvement.

The Ireland 10-year bond yield fell to 8.13% (from 8.9%).

The Portugal 10-year bond yield fell to 6.74% from 7.2%.

by Calculated Risk on 11/12/2010 09:55:00 AM

The preliminary Reuters / University of Michigan consumer sentiment index increased slightly in November to 69.3 from 67.7 in October.

Click on graph for larger image in new window.

This was a big story in when consumer sentiment collapsed again in July. Since then this measure of consumer sentiment has mostly moved sideways at a fairly low level.

In general consumer sentiment is a coincident indicator.

by Calculated Risk on 11/12/2010 09:00:00 AM

From Buck Wargo at the Las Vegas Sun: Condo sales at CityCenter a mixed bag

CityCenter projects it will have closed on 435 condominium units by the end of November out of 2,387 units it had on the market. ... even though it trimmed prices 30 percent a year ago
...
According to Las Vegas-based SalesTraq, more than 4,000 high-rise units remain unsold along the Strip.

The CityCenter (18% sold) is even doing worse than Trump Tower (25% sold). It will take years to clear this inventory.

Note: high rise condo units are not included in the new home inventory report from the Census Bureau, and they are also not included in the existing home inventory report from the NAR (unless they are list for sale). This is hidden inventory, and for certain cities like Las Vegas, this is significant.

by Calculated Risk on 11/11/2010 08:20:00 PM

Please don't miss my earlier post: Labor Force Participation Rate: What will happen?

From the Irish Times: Merkel refuses to back down over debt burden

The Irish Times has established ... that informal contacts are under way between Brussels, Berlin and other capitals to assess their readiness to activate the €750 billion rescue fund in the event of an application from Dublin.

Note: The European Financial Stability Facility (EFSF) is complicated and currently unfunded.

Also from the Irish Times (I noted the bank funding issue this morning based on information from a contact in Europe): Investor concern hits Irish banks as funding costs soar

INVESTOR CONCERN switched to the Irish banks yesterday as the cost of funding for AIB and Bank of Ireland rose to record levels and the credit-default swaps on Irish banks soared.

And from the Irish Times: G20 concern over Irish debt as bond yields pass 9%

Last night the rating agency Moody’s said it was awaiting the release of Ireland’s four-year fiscal plan later this month to decide whether to downgrade the country’s credit rating.