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Bank 21 Goes (Another GA Bank)
Old 03-28-2009, 05:51 AM   #1
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Bank 21 Goes (Another GA Bank)

#21 in the 2009 series of Banks to go under. This one is a good amount of $.

21st bank failure this year - Mar. 27, 2009
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Old 03-28-2009, 08:02 AM   #2
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WOW.....

Total deposits (which might not all be insured)... $796.8 million as of March 9, 2000

Total estimated cost to FDIC... $290 million.

That seems pretty high a ratio to me... sounds like this one should have been much earlier to go...
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Old 03-28-2009, 12:28 PM   #3
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Hmmmm. Some representative for all the small banks was on TV recently complaining about the increase in FDIC fees when it's only the "top 20 banks" who are getting all the protection/bailout. Seems like plenty of small ones are going by the wayside too.

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Old 03-28-2009, 12:31 PM   #4
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Quote:
Originally Posted by audreyh1 View Post
Hmmmm. Some representative for all the small banks was on TV recently complaining about the increase in FDIC fees when it's only the "top 20 banks" who are getting all the protection/bailout. Seems like plenty of small ones are going by the wayside too.
I don't think it's specifically a small-versus-large thing as much as it is the fact that even the conservatively managed banks are going to get unfairly screwed with the more reckless ones that caused the mess in the FDIC.

It's like a very safe driver being charged the same auto insurance rate as someone who has an accident and couple of DWIs, and if the insurer is on the verge of insolvency because of the reckless drivers costing them too much, the rates rise on everyone by the same amount regardless of driving record.

I don't think we'd tolerate an auto insurance pricing model like that, but we seem to be okay with it for bank deposit insurance.
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Old 03-28-2009, 03:58 PM   #5
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Saw a gragh which compared the S&L crisis (early 90's) to today's mess ... many more banks failed in the S&L mess ... we've got along way to go to hit those numbers. The insured deposits graph is more telling ....

Here's the graph link:

http://www.calculatedriskblog.com/20...-failures.html
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Old 03-29-2009, 08:24 PM   #6
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It does seem that having all banks pay the rate is not fair. But this could have been done at any time and I wonder why it wasn't done after the S&L crisis.

The FDIC fees and limits have been unchanged for so long they are way out of date. I suppose this only became glaringly obvious with the current crisis.

But the "spokesman" on TV was trying to make it a large national versus small community bank thing when it clearly is not. There are "bad" banks at both levels.

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