AS WE HAVE BEEN REPORTING ,THE HAND OF ALLAH IN PERSON CAN BE CLEARLY SEEN WORKING IN THE COLLAPSE OF THE ANGLO FINANCIAL SYSTEM,ESPECIALLY IN AMERICA.THIS TIME AMERICA’S LOSSES WILL CONTINUE TO MOUNT.THESE ARE UNAVOIDABLE LOSSES.ALLAH IN THE PERSON OF MASTER FARD MUHAMMAD(THE CHRIST AND MESSIAH) IS IN THE DRIVER’S SEAT STEERING AMERICA AND HER ECONOMY INTO THE FLAMES.
JUST LOOK AT AMERICA BEING CHOPPED DOWN BY DEGREES;”(AP) Regulators on Friday shut down banks in Florida, Arizona and Kansas, bringing to 133 the number of U.S. banks that have failed to hold up this year against the struggling economy and a cascade of loan defaults.
The Federal Deposit Insurance Corp. took over Miami-based Republic Federal Bank, with $433 million in assets and $352.7 million in deposits. A bank based in Boca Raton, Fla., 1st United Bank, agreed to assume all the deposits and $267.1 million of the assets of the failed bank. The FDIC will retain the rest for eventual sale.
In addition, the FDIC and 1st United Bank agreed to share losses on $210.4 million of Republic Federal’s loans and other assets.
The FDIC also took over Valley Capital Bank, based in Mesa, Ariz., with $40.3 million in assets and $41.3 million in deposits; and SolutionsBank in Overland Park, Kans., with $511.1 million in assets and $421.3 million in deposits.
Enterprise Bank & Trust, based in Clayton, Mo., agreed to assume the assets and deposits of Valley Capital, while Arvest Bank, based in Fayetteville, Ark., is buying the assets and deposits of SolutionsBank.
The FDIC also agreed with Enterprise Bank to share losses on $29.8 million of Valley Capital’s assets, and agreed with Arvest Bank to share losses on $411.3 million of SolutionsBank’s assets.
The FDIC estimates the failure of Republic Federal will cost the deposit insurance fund $122.6 million; the failure of Valley Capital an estimated $7.4 million; and the failure of SolutionsBank an estimated $122.1 million.
The shutdown of Republic Federal brought to 13 the number of bank failures in Florida so far this year. Failures also have been concentrated in California, Georgia and Illinois.
Last week saw the failure of Ohio’s AmTrust Bank, the fourth-largest bank to fail this year, with about $12 billion in assets and $8 billion in deposits. The Cleveland-based bank’s failure is expected to cost the federal deposit insurance fund an estimated $2 billion.
As the economy has soured, with unemployment rising, home prices tumbling and loan defaults soaring, bank failures have accelerated and sapped billions out of the federal deposit insurance fund. It has fallen into the red.
The 133 bank failures are the most in a year since 1992 at the height of the savings-and-loan crisis. They have cost the federal deposit insurance fund more than $28 billion so far this year. They compare with 25 last year and three in 2007.
The FDIC expects the cost of bank failures to grow to about $100 billion over the next four years.
Depositors’ money – insured up to $250,000 per account – is not at risk, with the FDIC backed by the government.
Banks have been especially hurt by failed real estate loans, both residential and commercial. Banks that had lent to seemingly solid businesses are suffering losses as buildings sit vacant. As development projects collapse, builders are defaulting on their loans.
If the economic recovery falters, defaults on the high-risk loans could spike. Many regional banks hold large concentrations of these loans. Nearly $500 billion in commercial real estate loans are expected to come due annually over the next few years.
This week, the Obama administration extended until next October the $700 billion financial bailout program, saying the fund was still needed to prevent further turmoil in the banking system. Treasury Secretary Timothy Geithner said extending the rescue program also will help homeowners struggling to avoid losing homes to foreclosure and small businesses having trouble getting loans.
Hundreds of banks, including major Wall Street institutions, received taxpayer support through the politically unpopular rescue called the Troubled Asset Relief Program, or TARP. It had been due to expire at year’s end. Congress enacted the program in October 2008, at the height of the financial crisis with markets in free fall.
The government said this week, however, that banks are paying back the emergency loans faster than expected. That, plus interest and other returns, will mean the program will cost $200 billion less than expected.
Bank of America Corp., the second-largest U.S. bank, announced this week that it had repaid the entire $45 billion it owed, plus interest. The repayment frees the bank from the government restrictions that have hampered its search for a new chief executive, including executive pay limitations. “Click here for reuse options!