US BANKS FAILURE REACHES 140

US BANKS FAILURE REACHES 140

Bank failure tally reaches 140
By Ben Rooney, staff reporter December 18, 2009: 8:23 PM ET

NEW YORK (CNNMoney.com) -- Banks in six U.S. states were closed Friday, bringing the total number of failed banks this year to 140, at a cost of over $1 billion to the Federal Deposit Insurance Corporation.

Among the institutions seized by regulators was a so-called "bankers' bank" in Illinois called Independent Bankers' Bank (IBB), which had about 450 client banks in four U.S. states.

Unlike the majority of banks closed this year, IBB did not take deposits from, or make loans to consumers. Instead, it offered a variety of services such as check clearing and credit card operations to community banks around the country that find it too costly to do this on their own.

The FDIC said it created a bridge bank to take over the operations of the Springfield Ill.-based institution.

Earlier this year, regulators seized Atlanta-based Silverton Bank, which was one of the largest U.S. bankers' banks. Silverton often acted as the lead banker on some syndicated commercial real estate loans, and its collapse was seen as hastening the demise of many of its regional partners.

Separately, Illinois state officials closed Citizens State Bank. The FDIC created the Deposit Insurance National Bank of New Baltimore (DINB) to take over the failed bank. DINB will remain open for 45 days to allow depositors of the failed institution to open new accounts elsewhere.

In Florida, Peoples First Community Bank, which operated 29 branches, was closed by the Office of Thrift Supervision (OTS) and the FDIC was named receiver.

Hancock Bank of Gulfport, Miss., will assume the failed bank's $1.7 billion in deposits and will purchase the bulk of its $1.8 billion in total assets.

Two banks in California were also closed.

State regulators seized La Jolla-based Imperial Capital Bank, which operated 9 branches. The FDIC said Los Angeles-based City National Bank will acquire all of the failed bank's $2.8 billion deposits and will buy the bulk of its $4 billion in assets.

The OTS shuttered Santa Monica-based First Federal Bank of California. OneWest bank of Pasadena has agreed to assume the failed bank's $4.5 billion in total deposits and to buy the $6.1 billion in total assets.

The 39 branches of First Federal Bank will reopen on Saturday as branches of OneWest Bank. Depositors can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

The OTS closed the sole branch of New South Federal Savings bank in Irondale, Ala. The failed bank will reopen Monday under the management of Plano, TX-based Beal Bank.

Meanwhile, the FDIC said it was unable to find another financial institution to take over the operations of Atlanta-based RockBridge Commercial Bank. As a result, the agency said it would mail checks to insured depositors on Monday.

RockBridge had an estimated $2.1 million in uninsured funds. But this amount could change once the FDIC obtains additional information from these customers.

The FDIC currently covers accounts up to $250,000.

Beginning Monday, customers with deposits exceeding $250,000 at the bank may visit the FDIC's Web page "Is My Account Fully Insured?"

An average of 11 banks have failed every month this year. The spike in failures has raised concerns about the FDIC's deposit insurance fund, which has slipped into the red for the first time since 1991.

The fund was $8.2 billion in the hole as of the end of September. But that includes $21.7 billion the agency has earmarked for future bank failures.

Friday's closures will cost the FDIC an estimated $1.7 billion.

This year's tally of bank failures is the highest number since 1992, when 181 banks failed. But the total is far from 1989's record high of 534 closures which took place during the savings and loan crisis, when the insurance fund also carried a negative balance. To top of page

Total Failed Bank List: http://www.fdic.gov/bank/individual/failed/banklist.html

2 comments:

Ricard said...

Read: http://newscri.be/ http://newscri.be/link/969160

December 22, 2009 7:47 PM

Ricard said...

Ironically, Western Powers predicted China's banks would fail; this did not happen, instead many US and European banks failed miserably last year and this year!

December 23, 2009 11:17 PM

FINANCIAL LIBERATION NOT THE ANSWER

FINANCIAL LIBERATION NOT THE ANSWER

Bigger economic crisis ahead unless...
by Zakiah Koya

Prof Dr Jomo Kwame Sundram
KUALA LUMPUR (Dec 20, 2009) : A bigger crisis awaits Malaysia if we continue on the path of financial liberalisation and fail to learn the right lessons from the last economic downturn in the late 1990s, warns an economist.

Prof Jomo Kwame Sundaram, who is the assistant secretary general for Economic Development in the United Nations’ Department of Economic and Social Affairs, said financial liberalisation, as it showed in the 1997-98 Asian crisis, is actually the “bleeding of resources from poor to rich countries" and does not lead to development.

Jomo, who was giving a public lecture titled When Will We Ever Learn? last Wednesday, explained that the last financial meltdown not only prompted some rethinking of how to “manage” financial crises but also stimulated some serious rethinking about the character of the development model in Asia.

Lessons were supposed to have been learnt and new policy and institutional frameworks were put into place to avoid another crisis, he said.

However, after all that the country had gone through, the severity of the current crisis begs a question: did politicians and policymakers really learn the right lessons from 10 years ago?

Jomo said that the way Malaysia handled the last economic crisis was not very wise and pointed out that contrary to popular belief, it was palm oil that saved us then by spurring economic growth, and not the pegging of the ringgit to the US dollar.

“The truly local palm oil industry – everything was Malaysian about it from A to Z – which spurred the economic growth. It was not the industrialisation and setting up of the industrial zones,” said Jomo.

He also had harsh words about recent attempts to liberalise the local financial market, saying that it has been proven that this does not bring about development.

Instead, Jomo said, it bled out the capital resources of Third World countries.

“Half of the capital inflows in the year 2007 went to the US due to financial liberalisation,” he said, adding that it was imperative for Malaysia to start planning the real economy and not look to the US model.

"There is an urgent need for much more original and creative development policy thinking in the region," he said, and warned that if we continue on this path (of financial liberalisation), "Malaysia’s development status target of 2020 would be delayed by a decade."

How can Malaysia get itself out of its present economic predicament? The answer for us, Jomo said, lies with palm oil.

“If Brazil can be committed to research on bio-ethanol – fuel made from sugar cane – and today compete in the car world market, there is no reason why we cannot come up with such an answer,” he said.

Climate Change Talks end with ‘noting’

Talks end with ‘noting’

Global Trends by MARTIN KHOR

The Copenhagen Conference ended in some disarray because a secretive meeting of leaders of 26 countries was seen as undemocratic by many, and its Accord was thus only “noted” and not adopted.
The Copenhagen Climate Con-ference ended in disarray, though not in complete failure, and the urgent task now is to pick up the pieces and get the global talks going again next year, as there is much at stake.
The Conference foundered in its last hours on the issue of international democracy and global governance.
The question was: Can a “deal” patched up by leaders of 26 countries in a secretive meeting that was not supposed to happen be simply presented to 193 countries to adopt without changes in the dying hours of what is claimed to be the most important international conference ever held?
The answer came in the early hours of Saturday morning, after many hours of high drama in the Conference hall, and it was “no”.
When Danish Prime Minister Lars Rasmussen, who presided over the Conference’s final days, convened the final plenary session late last Friday night, he for the first time, officially announced that a meeting had been taking place of leaders of 26 countries (whose names he did not give) and that a Copenhagen Accord had been drawn up for the Conference to adopt. As he tried to leave the podium after suspending the meeting for an hour, he was stopped by Venezuelan delegate Claudia Caldera on a point of order.
“After keeping us waiting for hours, after several leaders from developed countries have told the media an agreement has been reached when we haven’t even been given a text, you throw the paper on the table and try to leave the room,” she said.
This behavior is against United Nations practice and the UN Charter itself, she said.
“Until you tell us where the text has come from, and we hold consultations on it, we should not suspend this session. Even if we have to cut our hand and draw blood to make you allow us to speak, we will do so,” she added, referring to how she had banged on the table for almost a minute in her effort to get the attention of Rasmussen before he left the podium.
Several developed countries then spoke up to defend the work that had been done by the political leaders in the small group, which should be respected instead of vilified, and urged that the Copenhagen Accord be adopted.
This was also the position of several developing countries, including the Maldives, Ethiopia, Grenada and Lesotho. Notably, China and India — the developing countries that were the most active in the small meeting — did not speak to urge others to adopt the Accord.
When it became clear there was no consensus to adopt the document, some developed countries, led by the United Kingdom and Slovenia, proposed a vote be taken, or else that it be adopted with the names of dissenting countries placed in a footnote.
These “adoption by non-consensus” views were rejected by others who pointed out that it was against the rules of procedure.
After hours of wrangling and a break for consultations, a compromise was reached, in which a Decision was adopted in which the Conference of Parties “takes note of the Copenhagen Accord of 18 De­­cember 2009.”
The Accord, with the names of countries that took part in the small meeting, would be attached to the Decision.
In the language of the UN, “taking note” gives a low or neutral status to the document being referred to.
It means that the document is not approved by the meeting (in which case the word “adopts” would be used). “Taking note” also does not connote whether the document is seen in a positive light (in which case the word “welcomes” would be used) or negatively (in which case “rejects” or “disapproves of” would be used).
Following the adoption of the decision to simply “take note” of the document, more hours were spent on how to interpret the “takes note” decision, with the developed countries trying to stretch its meaning.
The US, supported by a number of other developed countries, tried to interpret the decision as allowing for an “opt in” type of arrangement, with countries notifying their intention to join. They tried to garner support for expanding the “takes note” decision into a system that seems styled after a plurilateral agreement, and linked it to the finance issue in an attempt to get support from developing countries.
Ed Miliband, the UK’s Climate Minister, was blunt about linking the funding of developing countries with accepting the Accord.
Those which support the Accord have to register this support.
The concerns he raised must be duly noted “otherwise we won’t operationalise the funds.”
The US wanted an arrangement through which Parties can associate with the Accord. It said there are funds in the Accord, and “it is open to any Party that is interested.”
This implies that Parties that do not register their endorsement of the Accord would not be eligible for funding. This attempted linkage of finance to the acceptance of the Accord is of course not in line with the rules of the Climate Convention, in which the which the developed countries have committed themselves to provide developing countries with the funds needed for them to take climate related actions.
Funding the actions of developing countries does not require that a new agreement or an Accord be established. The actual Copenhagen Accord itself is only three pages in length. What is left out is probably more important than what it contains.
The Accord does not mention any figures of the emission reduction that the developed countries are to undertake after 2012, either as an aggregate target or as individual country targets. This failure at attaining reduction commitments is the biggest failure of the document and of the whole Conference.
It marks the failure of leadership of the developed countries, which are responsible for most of the Greenhouse Gases retained in the atmosphere, to commit to an ambitious emissions target.
While the developing countries have demanded that the aggregate target should be over 40% reduction by 2020 compared to 1990 levels, the national pledges to date by developed countries amount to only 13-19% in aggregate. Perhaps, this very low ambition level is the reason that the Accord remains silent on this issue.
The Accord recognises the broad scientific view that global temperature increase should be below 2 degrees Celsius, and agrees to enhance cooperative action, on the basis of equity.
This echoes the view recently affirmed by India that accepting a target of temperature limit, whether it be 2 or 1.5 degrees, has to come with a burden-sharing framework, with equity as its basis.
The Accord states the collective commitment of developed countries to provide new and additional funds of US$30bil (RM103bil) in 2010-2012 through international institutions. It is unclear how new the funds will be, since the developed countries have already committed to contribute billions of dollars to the World Bank’s climate investment funds.
It also states the developed countries will jointly mobilize US$100bil (RM343bil) a year by 2020 for developing countries.
The Accord is a thin document, containing hardly any new commitments by developed countries, with a weak global goal, and attempts to get developing countries to do more. It is a sad reflection of the Copenhagen Conference that this thin document is being held up as its main achievement.

1 comments:

Ricard said...

American hegemony!

December 24, 2009 12:26 AM

An insider’s view of US imperialism

Review by ABBY WONG

Hoodwinked: An Economic Hit Man Reveals Why the
World Financial Markets Imploded and What We Need to
Do to Remake them
Author: John Perkins
Publisher: Broadway Books
THERE exists such a profession – Economic Hit Man (EHM). Sounds fascinating but it is an arcane profession known only by few because of its rather unnerving job description – traveling to third world countries blessed with resources that American corporations covet, bribing their leaders into privatisation and modernisation projects that will ravage the environment and result in debts so huge that these countries eventually default in payment and become part of the American colony.

“EHMs are highly paid professionals who cheat countries around the globe out of trillions of dollars,” John Perkins, a former EHM, deadpans.
While his experience as an EHM has enabled him to write Confessions of an Economic Hit Man, a worldwide bestseller that exposes the extent to which American corporations will go to maximise profit, it has also given him an insider view to analyse in greater depth the driving forces behind the recent financial meltdown that sent the US and the world spiraling towards disasters.
Perkins’ analysis is stunning and groundbreaking to anyone who cares about the world and world economy, but to bankers and corporate CEOs, it is a bombshell.
In Hoodwinked, his new tell-all book, Perkins reveals how the very system that is perpetrated by EHMs to countries outside of the US is being used within corporate America in the last two decades, destroying an economy that was once regulated and sustainable.
Perkins calls this system mutant capitalism in which CEOs of large corporations carry out unscrupulous, unjust and law-breaking business practices within the US and outside in every corner of the world to maximise short-term profits.
It was a system that began during Ronald Reagan’s administration when American companies were encouraged by its president to conquer the rest of the economic world, hoping to thwart the USSR and Cold War through capitalism. And it did.
As policy makers began to adopt Friedman’s loose monetary economics and turned their back against Keynesian conservative and regulatory economics, corporations merged and acquired to become bigger.
They peddled their ever-increasing products to new markets until the world was saturated with so many goods that they became needless and useless. When demands ran dry and profits were threatened, companies and policy makers came out with a creative solution: loosen the monetary policy to allow consumers easy access to credit so as to expand their ability to spend.
In economic terms, they superficially shifted the whole demand curve thanks to two powerful Friedman economists – Federal Reserve chairman Alan Greenspan and Secretary of the Treasury Robert Rubin, both of whom served under the Clinton administration.
Corporate America moved swiftly from manufacturing to paper finance in the 1990s. Gone were classic American ingenuity and entrepreneurship stories of Dell, Bill Gates and Steve Jobs.
While conglomerates still manufactured and used their monopolistic tentacles to invade every corner of the world, it was investment bankers that reined the corporate world.
The greedy herd from all over the world rushed into the financial world despite the incomprehensible nature of financial products and investment schemes.
Those who fretted were fools because there was so much money to be made from stocks, real estate or any other medium of investment in any part of the world.
The financial world had never been so connected and Alan Greenspan was christened the most powerful person in the world.
It did not take long for the millions of Americans, and millions more outside of the US, who had spent to the hilt and leveraged through the roof to default.
Like EMHs did to third world nations, investment bankers enslaved consumers with debt that they could not pay. By the time the whole system collapsed, the world headed towards calamity.
The whole book reads like a thriller but it is not at all fiction. Some of the events narrated are still fresh in our minds, those who worked in the financial markets during the 1990s and 2000s. While Perkins is harsh in his criticism of corrupt bankers, politicians and EHMs, what piques him the most are the powerful conglomerates that make money at the expense of people and the environment.
The world would be a better place if corporations could be more socially responsible by moving beyond profit-maximisation, materialism and militarism that characterise the current economy to one that produces goods and services that serve the earth as well as its billions of inhabitants.
It is rare to see someone who is deeply involved with the government and corporate world to come forward and disclose the dark netherworld of US imperialism. Perkins’ book is a must-read for it is a work of moral courage and righteousness.