by Calculated Risk on 8/14/2009 09:34:00 PM

Four small minnows passed
A "whale" also sleeps on beach
Sharks circle for more
by Soylent Green is People
From the FDIC: MidFirst Bank, Oklahoma City, Oklahoma, Assumes All of the Deposits of Union Bank, National Association, Gilbert, Arizona

Union Bank, National Association, Gilbert, Arizona, 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 12, 2009, Union Bank, N.A. had total assets of $124 million and total deposits of approximately $112 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $61 million. ... Union Bank, N.A. is the 75th FDIC-insured institution to fail in the nation this year, and the second in Arizona. The last FDIC-insured institution to be closed in the state was Community Bank of Arizona, Phoenix, also today.

From the FDIC: MidFirst Bank, Oklahoma City, Oklahoma, Assumes All of the Deposits of Community Bank of Arizona, Phoenix, Arizona

Community Bank of Arizona, Phoenix, Arizona, was closed today by the Arizona Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of June 30, 2009, Community Bank of Arizona had total assets of $158.5 million and total deposits of approximately $143.8 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $25.5 million. ... Community Bank of Arizona is the 76th FDIC-insured institution to fail in the nation this year, and the first in Arizona. The last FDIC-insured institution to be closed in the state was NextBank, Phoenix, on February 7, 2002.

From the FDIC: FDIC Creates a Deposit Insurance National Bank to Facilitate the Resolution of Community Bank of Nevada, Las Vegas, Nevada

Community Bank of Nevada, Las Vegas, Nevada, was closed today by the State Commissioner, by Order of the Nevada Financial Institutions Division, which then appointed Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of June 30, 2009, Community Bank of Nevada had total assets of $1.52 billion and total deposits of about $1.38 billion. ...

The FDIC as receiver will retain all the assets from Community Bank of Nevada for later disposition. Loan customers should continue to make their payments as usual.

The cost to the FDIC's Deposit Insurance Fund is estimated to be $781.5 million. Community Bank of Nevada is the 77th bank to fail this year and the third in Nevada. The last bank to be closed in the state was Great Basin Bank, Elko, on April 17, 2009

by Calculated Risk on 8/14/2009 08:47:00 PM

From Kris Hudson at the WSJ: Hotels Deliver Some 'Jingle Mail'

... From San Diego to Dearborn, Mich., an increasing number of hotel owners in the U.S. market are simply walking away ...

Distressed noncasino hotel loans now cover more than 1,000 properties with a cumulative loan value of $16.8 billion, according to Real Capital Analytics ....

Delinquencies of loans on casinos that have hotels adds 31 properties and $8.6 billion in distressed loans to the mix.

... According to Trepp LLC, the delinquency rate for CMBS tied to hotels was 4.75% in the second quarter, up from 0.5% a year earlier. Debt-rating provider Fitch Ratings predicts that rate will jump to between 10% and 15% by year end.

There is much more in the article.

A few points on hotels:

The occupancy rate has already peaked for the year (see graph below), and hotels that are struggling will be crushed in the Fall. So it is no surprise that Fitch expects the delinquency rate to soar.

Many hotels were purchased with too much debt based on optimistic pro forma income projections, and the owners are now far underwater.

RevPAR (Revenue per available room) is running about 16% below last year according to HotelNewsNow.com .

And there is more inventory coming (Supply growth to stifle RevPAR in 2010).

Click on graph for larger image in new window.

The peak occupancy rate for 2009 was probably three weeks ago at 67%.

And that is far below normal ... and it is all downhill for the rest of the year.

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

Occupancy rates are far below historical levels, room rates are falling, there is more supply coming online - and many properties have too much debt. That spells Jingle Mail!

by Calculated Risk on 8/14/2009 06:08:00 PM

Busy drones humming
Colonial colonized
Queen bee Bair in charge.
by Soylent Green is People
From the FDIC: BB&T, Winston-Salem, North Carolina, Assumes All of the Deposits of Colonial Bank, Montgomery, Alabama

Colonial Bank, Montgomery, Alabama, was closed today by the Alabama State Banking Department, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

Colonial Bank's 346 branches in Alabama, Florida, Georgia, Nevada and Texas will reopen under normal business hours beginning tomorrow and operate as branches of BB&T. ...

"The past 18 months have been a very trying period in the financial services arena, but the FDIC and its staff have performed as Congress envisioned when it created the corporation more than 75 years ago," said FDIC Chairman Sheila C. Bair. "Today, after protecting almost $300 billion in deposits since the current financial crisis began, the FDIC's guarantee is as certain as ever. Our industry funded reserves have covered all losses to date. In fact, losses from today's failures are lower than had been projected. I commend our staff for their excellent work in assuring once again a smooth transition for bank customers with these resolutions. The FDIC continues to stand by the nation's insured deposits with the full faith and credit of the U.S. government. No depositor has ever lost a penny of their insured deposits."
...
As of June 30, 2009, Colonial Bank had total assets of $25 billion and total deposits of approximately $20 billion. ... The FDIC and BB&T entered into a loss-share transaction on approximately $15 billion of Colonial Bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $2.8 billion. ... Colonial Bank is the 74th FDIC-insured institution to fail in the nation this year, and the first in Alabama. The last FDIC-insured institution to be closed in the state was Birmingham FSB, Birmingham, on August 21, 1992.

by Calculated Risk on 8/14/2009 04:38:00 PM

NOTE: This bank was on the Problem Bank List (Unofficial) released earlier. The bank had received a "PROMPT CORRECTIVE ACTION DIRECTIVE" on May 5th, and that is basically a "Hail Mary pass." - usually means failure.

Dwelling House= Flop House
Bureaucrats to clean up mess
We are new slum lords
by Soylent Green is People
From the FDIC: PNC Bank, National Association, Pittsburgh, Pennsylvania, Assumes All of the Deposits of Dwelling House Savings and Loan Association, Pittsburgh, Pennsylvania

Dwelling House Savings and Loan Association, Pittsburgh, Pennsylvania, was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of March 31, 2009, Dwelling House Savings and Loan Association had total assets of $13.4 million and total deposits of approximately $13.8 million. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $6.8 million. ... Dwelling House Savings and Loan Association is the 73rd FDIC-insured institution to fail in the nation this year, and the first in Pennsylvania. The last FDIC-insured institution to be closed in the state was Metropolitan Savings Bank, Pittsburgh, on February 2, 2007

Just a tease ... but look at the losses as a percent of total assets.

by Calculated Risk on 8/14/2009 03:58:00 PM

There are reports that Colonial will be seized today.

Still waiting on Guaranty (Texas), Corus, and many others: see August 14 Problem Bank List (unofficial) below.

Click on graph for larger image in new window.

The first graph shows the S&P 500 since 1990.

The dashed line is the closing price today.

The S&P 500 is up 48.4% from the bottom (328 points), and still off 35.8% from the peak (561 points below the max).

The S&P 500 first hit this level in Feb 1998; over 11 years ago.

Note: Doug may be a little slow updating today.

Instead of comparing the markets from the peak (See: the Four Bad Bears), Doug Short matched up the market bottoms for four crashes (with an interim bottom for the Great Depression).

Note that the Great Depression crash is based on the DOW; the three others are for the S&P 500.