by Calculated Risk on 12/18/2009 06:29:00 PM

Peoples, Citizens
New South Federal Savings
One Forty Is Near

An Oxymoron
Independent Bankers Bank
Not since Five today.
by Soylent Green is People
From the FDIC: Hancock Bank, Gulfport, Mississippi, Assumes All of the Deposits of Peoples First Community Bank, Panama City, Florida

Peoples First Community Bank, Panama City, Florida, was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver....

As of September 30, 2009, Peoples First Community Bank had approximately $1.8 billion in total assets and $1.7 billion in total deposits. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $556.7 million. ... Peoples First Community Bank is the 135th FDIC-insured institution to fail in the nation this year, and the fourteenth in Florida. The last FDIC-insured institution closed in the state was Republic Federal Bank, N.A., Miami, on December 11, 2009.

From the FDIC: FDIC Creates a Deposit Insurance National Bank to Facilitate the Resolution of Citizens State Bank, New Baltimore, Michigan

Citizens State Bank, New Baltimore, Michigan, was closed today by the Michigan Office of Financial and Insurance Regulation, which then appointed Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of September 30, 2009, Citizens State Bank had $168.6 million in total assets and $157.1 million in total deposits. ...

The cost to the FDIC's Deposit Insurance Fund is estimated to be $76.6 million. Citizens State Bank is the 136th bank to fail this year and the fourth in Michigan. The last FDIC-insured institution closed in the state was Home Federal Savings Bank, Detroit, on November 6, 2009

From the FDIC: Beal Bank, Plano, Texas, Assumes All of the Deposits of New South Federal Savings Bank, Irondale, Alabama

New South Federal Savings Bank, Irondale, Alabama, was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. ...

As of September 30, 2009, New South Federal Savings Bank had approximately $1.5 billion in total assets and $1.2 billion in total deposits. ...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $212.3 million. ... New South Federal Savings Bank is the 137th FDIC-insured institution to fail in the nation this year, and the third in Alabama. The last FDIC-insured institution closed in the state was CapitalSouth Bank, Birmingham, on August 21, 2009.

From the FDIC: FDIC Creates Bridge Bank to Take Over Operations of Independent Bankers' Bank, Springfield, Illinois

The Federal Deposit Insurance Corporation (FDIC) created a bridge bank to take over the operations of Independent Bankers' Bank, Springfield, Illinois, after the bank was closed today by the Illinois Department of Financial and Professional Regulation—Division of Banking, which appointed the FDIC as receiver. ...

As of September 30, 2009, Independent Bankers' Bank had approximately $585.5 million in assets and $511.5 in deposits. At the time of closing, the bank had an estimated $269,000 in uninsured funds. ...

The FDIC estimates that the cost to the Deposit Insurance Fund will be $68.4 million. Independent Bankers' Bank is the 138th bank to fail in the nation this year and the twenty-first in Illinois. The last FDIC-insured institution to fail in the state was Benchmark Bank, Aurora, on December 4, 2009.

Three banks today with no buyer!

by Calculated Risk on 12/18/2009 05:12:00 PM

What happened down South?
Georgian banks fuel the collapse
A Rockbridge too far
by Soylent Green is People
From the FDIC: FDIC Approves the Payout of the Insured Deposits of Rockbridge Commercial Bank, Atlanta, Georgia

The Federal Deposit Insurance Corporation (FDIC) approved the payout of the insured deposits of RockBridge Commercial Bank, Atlanta, Georgia. ...

The FDIC was unable to find another financial institution to take over the banking operations of RockBridge Commercial Bank. ...

As of September 30, 2009, RockBridge Commercial Bank had approximately $294.0 million in total assets and $291.7 million in total deposits. At the time of closing, the bank had an estimated $2.1 million in uninsured funds. ...

RockBridge Commercial Bank is the 134th FDIC-insured institution to fail this year and the twenty-fifth in Georgia since The Buckhead Community Bank, Atlanta, was closed on December 4, 2009. The FDIC estimates the cost of the failure to its Deposit Insurance Fund to be approximately $124.2 million.

No buyers - a bad sign. And $2.1 million uninsured?

by Calculated Risk on 12/18/2009 04:35:00 PM

From Bloomberg: Moody’s Reviews $143 Billion of Jumbo-Mortgage Bonds (ht Bob_in_MA)

Moody’s Investors Service placed $143 billion of jumbo-mortgage bonds under review for downgrades ... The revisions were prompted by “the rapidly deteriorating performance of jumbo pools in conjunction with macroeconomic conditions that remain under duress,” Moody’s said.

... An “overhang of impending foreclosures will impact home prices negatively,” with values likely to decline 9 percent more ... U.S. unemployment will rise to peak at about 10.6 percent ...

Moody’s also said it expects the U.S. government’s effort to curb foreclosures to be less effective than it previously expected because the programs have “failed to gain traction.”
emphasis added

The problems are moving on up the value chain.

This is a follow-up to this story yesterday: Luxury-Home Owners in U.S. Use ‘Short Sales’ as Defaults Rise (many hts!)

by Calculated Risk on 12/18/2009 03:08:00 PM

"The 1980s trained macroeconomics -- like Greg Mankiw and Ben Bernanke and so forth -- became a very complacent group, very ill adapted to meet with a completely unpredictable and new situation, such as we've had. I looked up ... Mankiw's bestseller, both the macro book and his introductory textbook, I went through the index to look for liquidity trap. It wasn't there!"
Paul Samuelson, June 2009

Here is an interview with Paul Samuelson from June (Dr. Samuelson passed away last weekend at the age of 94):

An Interview With Paul Samuelson, Part One (ht Jonathan)

An Interview With Paul Samuelson, Part Two

On Greenspan and the stock bubble:

"I can remember when some of us -- and I remember there were a lot of us in the late 90s -- said you should do something about the stock bubble. And he kind of said, 'look, reasonable men are putting their money into these things -- who are we to second guess them?' Well, reasonable men are not reasonable when you're in the bubbles which have characterized capitalism since the beginning of time."

by Calculated Risk on 12/18/2009 12:45:00 PM

Update comment: I feel torn about digging into Chairman Bernanke's private affairs, but this seems to be in the public interest based on Bernanke's comments, his position, and the current crisis.

Effective Demand has some more details: So I pulled Bernanke's mortgage...

Bernanke bought in May 2004 for $839,000. He had a 5/1 ARM for $671,200 at 4.125% that adjusted to 12 month Libor in June of each year after his fixed period ended. To calculate his rate you take 12 month Libor on that date and add 2.250%, it can't adjust more than 2% in any one year due to restrictions on the note. He also had a purchase money second $83,900 but for some reason I can't find the interest rate on that one, nor do I see an ARM rider for it so it could very well be fixed. Both notes indicate they are amortizing loans.

So what does this all mean? Well according to the terms I see for Bernanke's first and the little information on historic LIBOR I can find (here)... his rate actually went down.

How did it "explode" if his rate went down?

I was assuming this was an Option ARM and Chairman Bernanke was paying the negatively amortizing payment. Then, when the loan recast to amortize over the remaining term (25 years), the payment would have increased significantly.

But Effective Demand's information raises several questions: Why did Bernanke refi? What did he mean by "explode", and was his home underwater when he refinanced since he bought in 2004 and apparently borrowed 90% LTV with only 10% down.