Tuesday, November 17, 2009
It may not be long before someone in charge of a congressional committee in Washington asks the Treasury Department: “How do you define healthy?” So far in November three banks have collapsed that received federal bailout funds (from the Troubled Asset Relief Program, or TARP) either late last year or early in 2009; only “healthy banks” were supposed to have been given TARP funds. The latest seized by the Federal Deposit Insurance Corporation was Pacific Coast National Bank of San Clemente, CA, which was given $4.1 million from TARP in January. That investment is now lost.
The other two TARP-supported banks to fail this month are CIT (taking with it $2.3 billion) and United Commercial Bank (which received $299 million in bailout support).
In addition to Pacific Coast, FDIC regulators last Friday also took over two other failing institutions, neither of which received TARP help: Orion Bank and Century Bank, both of Florida. Orion will cost the FDIC $615 million and Century $344 million.
The total number of bank failures this year is now up to 123.
-Noel Brinkerhoff
Regulators Seize Another Recipient of TARP ‘Healthy Bank’ Bailout (by Paul Kiel, ProPublica)
Pacific Coast National Bancorp Receives $4.1 Million From U.S. Treasury (Pacific Coast National Bank)
First Bailed-Out Bank to be Shut Down by FDIC; Taxpayers Lose Another $1.4 Billion (by Noel Brinkerhoff, AllGov)
U.S. Taxpayers Lose $2 Billion as CIT Goes Bankrupt (by Noel Brinkerhoff, AllGov)
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