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This failed bank had no buyer. Something not right. Update

Submitted by carpavel on Fri, 03/05/2010 - 22:24
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Market ticker just commented on this. Here is his take.
http://market-ticker.denninger.net/archives/2049-All-You-Nee...

If you read the failed bank list every Friday like I do you read the press release to see how much it's gonna cost the FDIC. They share the expense with the buying bank. This bank had no buyer.
Here's the weird part.
The say the bank had 215 million in assests.
They say it had 205 million in deposits.
It should be enough to cover losses right? Wrong!
The cost to the FDIC will be almost 96 Million!
Did somebody forget to mark to market?
I don't understand.
Here's the link to the press release:
http://www.fdic.gov/news/news/press/2010/pr10046.html

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did anything else ever happen

Submitted by beverly33 on Wed, 03/10/2010 - 22:11.

did anything else ever happen with this?

Update bump

Submitted by carpavel on Sat, 03/06/2010 - 15:14.

Bump

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You are right about this being "not right!"

Submitted by SteveMT on Sat, 03/06/2010 - 13:54.

Especially because this "no buyer" situation is in Utah. The Mormons are business savvy, excellent entrepreneurs, and know how to save money. Only 10% of state residents smoke. They should be awash in sufficient funds to take this bank over with "only" $215M in total assets. Zion National Bank is huge in Utah. BUDDY CAN YOU SPARE ME $215M, SO I CAN BUY A BANK?

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

I think this is a first

Submitted by carpavel on Sat, 03/06/2010 - 12:42.

Pretty bad situation. Another bank the FDIC is operating it until it shuts down. This is a change from what they have done in the past. Are they just printing the money to operate this bank. Something is not right.

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I'm guessing that the $96

Submitted by Jive_Dadson on Fri, 03/05/2010 - 23:59.

I'm guessing that the $96 million is the FDIC's initial outlay. They'll be in the queue to be compensated with whatever the nominal $215 million in assets will fetch.

KEEPER

Submitted by Daddy WarBucks on Fri, 03/05/2010 - 23:20.

KEEPER

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posted

Submitted by BFrank on Fri, 03/05/2010 - 22:52.

on facebook. For me it is the best way to get to the sheep.

I have many sheepish friends!

http://www.facebook.com/mrbrianfrank

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Deposits are liabilities.

Submitted by Jive_Dadson on Fri, 03/05/2010 - 22:46.

Deposits are liabilities. They are assets also only if they have not been lent out (kept in reserve). That's not to say I understand where the 96 million came from. I don't.

Yes I know deposits are liabilities

Submitted by carpavel on Fri, 03/05/2010 - 23:07.

But assests should cover them. In any case people getting their money in the mail.

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Give it a week ...

Submitted by obscure titles on Fri, 03/05/2010 - 22:41.

They will have a buyer.

It just means that this one, unlike most of them, was a bit of a surprise.

There will be an update with a buyer in about a week.

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