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To: RockyBalboa who wrote (3497)	5/3/2008 3:29:59 PM
From: RockyBalboa	Read Replies (1) \| Respond to of 6370

REPEAT Get ready for the second inning! The ‘Pay Option ARM Implosion’…Subprime’s Big Brother Posted on April 30th, 2008 in Daily Mortgage/Housing News - The Real Story The Wall St Journal just nailed the Pay Option ARM story. It is about time the mainstream picks up on this. In my opinion, this is the big one. ‘The Subprime Implosion’ may have been only the ‘pre-quake’ with ‘The Pay Option/ALT-A Implosion’ being the ‘big quake’ and ‘The Prime Implosion’ being a long series of scattered aftershocks. Don’t you love what the banks /ratings agencies consider ‘Prime’. I have said for a long time now that ‘the Pay Option Implosion will make the Subprime Implosion look like a bad earnings report because they cut across all socio-economic boundaries’. Now the data are proving my point. This bailout will be the mother of bailouts. At least with a subprime loan, the balance does not rise each month (before the loan defaults), thank goodness. Not so for Pay Options. The Pay Option ARM never should have existed. Unless values continue to rise, most of these loans will fail. This loan was never intended to hold for any length of time or for a declining value environment. I did the video a few weeks ago with real data from the Fed comparing the total subprime vs. ALT-A universes. Click here or the link below. The ALT-A universe is much larger than the subprime universe in the higher priced states like CA and even nationally, it is somewhat larger. But due to the sheer exotic nature of many ALT-A loans, such as the Pay Option ARM, the crisis will likely be that much more devastating. -Best, Mr Mortgage

To: RockyBalboa who wrote (3497)	5/10/2008 4:56:45 PM
From: RockyBalboa	Respond to of 6370

As suggested, here is a Regional bank which failed: From the FDIC: Bank Closing Information for ANB Financial, NA, Bentonville, AR ANB Financial, National Association, Bentonville, Arkansas, was closed today by the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect depositors, the FDIC's Board of Directors approved the assumption of the insured deposits of ANB Financial by Pulaski Bank and Trust Company, Little Rock, Arkansas. The failed bank's nine offices will reopen Monday as branches of Pulaski Bank and Trust Company. Depositors of ANB Financial will automatically become depositors of the assuming bank. As of January 31, 2008, ANB Financial had approximately $2.1 billion in assets and $1.8 billion in total deposits. Pulaski Bank and Trust Company will assume $212.9 million of the failed bank's insured non-brokered deposits for a premium of 1.011% and will purchase $235.9 million of assets. At the time of closing, ANB Financial had approximately $39.2 million in 647 deposit accounts that exceeded the federal deposit insurance limit. These customers will have immediate access to their insured deposits, and they will become creditors of the receivership for the amount of their uninsured funds. ANB Financial also had approximately $1.6 billion in brokered deposits that are not part of today's transaction. The FDIC will pay the brokers directly for the amount of their insured funds. Over the weekend, all deposit customers can access their insured money by writing checks, or by using their debit or ATM cards. Checks drawn on the bank that did not clear before today will be honored up to the insured limit. ... In addition to assuming the failed bank's insured deposits, Pulaski Bank and Trust Company will purchase approximately $235.9 million of the failed bank's assets. The assets are comprised mainly of cash, cash equivalents and securities. The FDIC will retain the remaining assets for later disposition. The transaction is the least costly resolution option, and the FDIC estimates that the cost to its Deposit Insurance Fund is approximately $214 million. ....................................................... Regulators are bracing for well over 100 bank failures in the next 12 to 24 months, with concentrations in Rust Belt states like Michigan and Ohio, and the states that are suffering severe housing-market problems like California, Florida, and Georgia," said Jaret Seiberg, Washington policy analyst for financial-services firm Stanford Group.

To: RockyBalboa who wrote (3497)	6/19/2008 4:11:53 PM
From: RockyBalboa	Read Replies (2) \| Respond to of 6370

Regional banks with no risk management skills should go to zero, particularly in the hardest hit areas. (Vineyard bank is a good example...) Fallout From Bad Loans Rocks Regional Banks nytimes.com today Fifth Third and other regional banks across the nation are being shaken to the core by a 21st century financial crisis. For many of them, things are going from bad to worse. Home mortgages and other loans that the banks made in good times are souring so fast that many of the lenders are scrambling to prop themselves up. If the pain worsens — and many analysts say it will — some of these banks, like Fifth Third’s predecessors, may eventually seek out suitors, most likely large national rivals. For now, however, no one seems to want the regional banks. Stock market investors are deserting them en masse. On Wednesday, Fifth Third’s share price plunged 27 percent to $9.26, its lowest level in more than a decade, after the bank said it would cut its dividend and seek to raise $2 billion. Other financial stocks, particularly regional banks’ shares, also tumbled. The Standard & Poor’s 500 Regional Banks Index sank 6.8 percent. “Everybody is trying to figure out where the bottom is,” said Jennifer Thompson, a regional bank analyst for Portales Partners in New York. “Every time a bank reports another capital raise or reports that things are worse than they anticipated, there is another round of selling.” But Wednesday was just one more bad day in what has been a horrible year for small and midsize banks. Their descent in the stock market has been remorseless, reflecting the economic pain in their own backyards. Weakening housing and construction markets in regions like the Midwest, Southeast and Southwest have hit lenders in those areas hard. For the banks’ shareholders, the numbers tell a sad story: Wednesday’s decline brought the loss for the S.& P. bank index to 39.3 percent so far this year. Fifth Third’s odd name almost seems like a bad joke. Fifth Third has lost two-thirds of its value this year. Shares of two other banks based in Ohio, the National City Corporation, of Cleveland, and Huntington Bancshares, of Columbus, have suffered similar declines. Banks based in the Southeast are hurting, too. The Regions Financial Corporation, the biggest bank in Alabama, has lost half its value. Standard & Poor’s predicted this week that Regions would cut its dividend to conserve its capital in the face of rising losses on real estate loans. The share price of SunTrust Banks, which operates across the Southeast, has fallen almost 41 percent. Small and midsize lenders are in far less danger than they were during the 1980s and early 1990s, when about 1,600 federally insured institutions failed during a savings and loan crisis. But the breadth and depth of the current troubles have caught bank executives by surprise. Federal regulators are particularly concerned about the exposure of smaller banks to the commercial real estate market, which has softened in some parts of the country. But another worry is that raising money will become increasingly costly for banks that need capital. In a report issued this week, analysts at Goldman Sachs said banks might need as much as $65 billion on top of the $120 billion they have already raised. But so far the vast majority of investors who bought into financial companies in the hope that the industry was out of the woods have lost, and lost big. As a result, many investors are reluctant to sink more money into regional banks, fearing their investments will be diluted if the banks sell even more stock. While many regional banks are trading far below their book values — at $4.83 on Wednesday, National City fetched just a fifth of its book value per share — many people are simply afraid to buy.