by Calculated Risk on 8/07/2009 06:15:00 PM

Wise men said before
"A rising tide lifts all boats"
Not these submarines
by Soylent Green is People
From the FDIC: Stearns Bank, National Association, St. Cloud, Minnesota, Assumes All of the Deposits of First State Bank, Sarasota, Florida

First State Bank, Sarasota, Florida, was closed today by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of May 31, 2009, First State Bank had total assets of $463 million and total deposits of approximately $387 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $116 million. ... First State Bank is the 70th FDIC-insured institution to fail in the nation this year, and the fifth in Florida. The last FDIC-insured institution to be closed in the state was Integrity Bank, Jupiter, on July 31, 2009.

From the FDIC: Stearns Bank, National Association, St. Cloud, Minnesota, Assumes All of the Deposits of Community National Bank of Sarasota County, Venice, Florida

Community National Bank of Sarasota County, Venice, Florida, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of June 30, 2009, Community National Bank of Sarasota County had total assets of $97 million and total deposits of approximately $93 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $24 million. ... Community National Bank of Sarasota County is the 71st FDIC-insured institution to fail in the nation this year, and the sixth in Florida. The last FDIC-insured institution to be closed in the state was First State Bank, Sarasota, earlier today.

by Calculated Risk on 8/07/2009 04:22:00 PM

Freddie Mac Press Release:

Freddie Mac had a positive net worth of $8.2 billion at June 30, 2009. As a result, no additional funding was required from Treasury under the terms of the Senior Preferred Stock Purchase Agreement (Purchase Agreement) for the second quarter.
...
Provision for credit losses was $5.2 billion for the second quarter of 2009, compared to $8.8 billion for the first quarter of 2009. The decrease was driven by a reduced rate of growth in the company's loan loss reserve due to the recent modest national home price improvements, which the company believes to be largely seasonal.
emphasis added

No mention of the amount of nonperforming loans.

by Calculated Risk on 8/07/2009 03:30:00 PM

From MarketWatch: June consumer credit down for 5th straight month

U.S. consumers reduced their debt in June for the fifth consecutive month, the Federal Reserve reported Friday. Total seasonally adjusted consumer debt fell $10.29 billion, or at a 4.9% annual rate, in June to $2.502 trillion. Consumer credit fell in eight of the past nine months.

Click on graph for larger image in new window.

This graph shows the year-over-year (YoY) change in consumer credit. Consumer credit is off 2.8% over the last 12 months. The record YoY decline was 1.9% in 1991 - and that record has been shattered.

Note: Consumer credit does not include real estate debt.

by Calculated Risk on 8/07/2009 01:26:00 PM

From a SEC 8-K filed this morning:

On August 6, 2009, The Colonial BancGroup, Inc. (the Company or BancGroup) was informed by the U.S. Department of Justice that it is the target of a federal criminal investigation relating to the Company’s mortgage warehouse lending division and related alleged accounting irregularities. The Company has been informed that the alleged accounting irregularities relate to more than one year’s audited financial statements and regulatory financial reporting, and the Company’s Board of Directors and Audit Committee are making every effort to determine the impact of these alleged accounting irregularities on the Company’s financial statements and regulatory financial reporting. The Company intends to cooperate with the investigation.

Earlier in 2009, BancGroup provided documents to the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) in response to a subpoena issued by SIGTARP.

Also, the SEC has issued subpoenas to BancGroup seeking documents related to, among other things, BancGroup’s disclosures related to its participation in the U.S. Treasury Department’s Troubled Asset Relief Program and BancGroup’s disclosures respecting accounting for loan loss reserves. BancGroup has provided, and continues to provide, documents in response to these subpoenas.

On August 5, 2009, the Alabama State Banking Department provided notice to Colonial Bank that the Alabama State Banking Board will meet on August 12, 2009, at which time Colonial Bank will be asked to consent to the Superintendent’s exercise of his statutory authority to appoint the FDIC as receiver or conservator for the Bank if and when the Superintendent deems such appointment to be necessary. In the meantime, the Company continues to explore all possible capital-raising alternatives that would position it and Colonial Bank to comply with the requirements of the Orders to Cease and Desist to which they are subject.
emphasis added

Here is the press release.

by Calculated Risk on 8/07/2009 11:20:00 AM

Note: Several analysts follow the average workweek series to look for the end of a recession. The idea is that companies will increase the work week before they start hiring, so the average weekly hours might increase as a recession ends. The small increase in July will be viewed as a possible indicator. Other employment measures that are used to judge the end of a recession are the four-week moving average of initial unemployment claims (has fallen significantly) and the diffusion index (previous post).

A few more graphs based on the (un)employment report ...

Employment-Population Ratio

Click on graph for larger image in new window.

This graph show the employment-population ratio; this is the ratio of employed Americans to the adult population.

Note: the graph doesn't start at zero to better show the change.

The general upward trend from the early '60s was mostly due to women entering the workforce. As an example, in 1964 women were about 32% of the workforce, today the percentage is close to 50%.

This measure fell slightly in July to 59.4%, the lowest level since the early '80s. This also shows the weak recovery following the 2001 recession - and the current cliff diving!

Part Time for Economic Reasons

From the BLS report:

The number of persons working part time for economic reasons (sometimes referred to as involuntary part-time workers) was little changed in July at 8.8 million. The number of such workers rose sharply in the fall and winter but has been little changed for 4 consecutive months.

Note: "This category includes persons who would like to work full time but were working part time because their hours had been cut back or because they were unable to find full-time jobs."

The number of workers only able to find part time jobs (or have had their hours cut for economic reasons) is at 8.8 million. This is slightly below the peak of 9.1 million in May.

Note: the U.S. population is significantly larger today (about 305 million) than in the early '80s (about 228 million) when the number of part time workers almost reached 7 million. That is the equivalent of about 9.3 million today, so population adjusted this wasn't quite a record.

Average Weekly Hours

From the BLS report:

In July, the average workweek of production and nonsupervisory workers on private nonfarm payrolls edged up by 0.1 hour to 33.1 hours. The manufacturing workweek increased by 0.3 hour to 39.8 hours. Factory overtime was unchanged at 2.9 hours.

The average weekly hours has been declining since the early '60s, but usually falls faster during a recession. Average weekly hours in June was at the lowest level since the series began in 1964, and the uptick in July was very small.

Note: the graph doesn't start at zero to better show the change.

Earlier employment posts today:

Employment Report: 247K Jobs Lost, 9.4% Unemployment Rate for graphs of unemployment rate and a comparison to previous recessions.

Unemployment: Stress Tests, Unemployed over 26 Weeks, Diffusion Index