|
|
| The fallout from the seizure of the government sponsored housing enterprises continues — with class action filings, more banks’ disclosures of losses from their GSE holdings and a banking trade group’s call for help from regulators. Meanwhile, three more banks are facing regulatory actions because of their poor capital positions, and two banks have agreed to merge.
Charles R. Rinehart has been named chief executive officer of Downey Financial Corp., a press release yesterday said. Rinehart, who previously served as Chairman and CEO of H.F. Ahmanson, replaces interim CEO Thomas E. Prince who stepped in when Daniel D. Rosenthal stepped down in July. Franklin Bank Corp. said Friday that the NASDAQ Stock Market said it could retain its listing on the exchange as long as it files its 2007 Form 10-K, first-quarter 2008 Form 10-Q and second-quarter 2008 Form 10-Q with the Securities and Exchange Commission by Sept. 30. But the Houston-based firm is not even sure it can complete the filings by Nov. 28 and warned it may lose the listing anyway. First South Bancorp Inc. and Intermountain Community Bancorp both said they have no exposure to common or preferred securities issued by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corp. But the news wasn’t so good for Security Business Bancorp, which disclosed Friday it held $2 million in preferred shares of Fannie Mae. However, any losses are not expected to impact day-to-day operations or its well-capitalized status. Fannie and its secondary cousin, Freddie Mac, were placed into conservatorship by their regulator earlier this month — virtually wiping out entire classes of some investors. Bank of the James Financial Group Inc. said Thursday that a potential write down on its $2 million investment on preferred shares of Fannie will not impair its well-capitalized standing. Warnings from a number of small banks about the impact from the government’s seizure of Fannie and Freddie had the American Bankers Association calling on the Treasury Department and bank regulators to take quick action to avoid harming “otherwise fundamentally sound institutions.” A six-point plan proposed by ABA Thursday included the reinstatement of at least a portion of preferred share dividends; a delay in the reduction of preferred dividends; and the treatment of losses as ordinary income. On Sept. 23, a class action lawsuit was filed in U.S. District Court for the Southern District of New York on behalf of all purchasers of Freddie’s series Z preferred against investment banking firms that underwrote the offering, an announcement from the law firm of Vianale & Vianale LLP said. Goldman Sachs & Co., J.P. Morgan Chase & Co. and Citigroup Global Markets Inc. are accused of violating Section 12(a)(2) of the Securities Act of 1933 by failing to warn investors in marketing material about Freddie’s poor underwriting standards, inadequate risk-management procedues and exposure to mortgage losses. Fannie and some of its officers and directors are facing a class action filed on Sept. 18 in U.S. District Court for the Southern District of New York on behalf of investors who purchased securities between Nov. 9, 2007, and Sept. 5, 2008, Wolf Haldenstein Adler Freeman & Herz LLP announced. The defendants are accused of making materially false and misleading statements by failing to warn investors that the company was undercapitalized and would continue to be undercapitalized even after raising billions of dollars. Community Banks of Northern California has entered into an agreement with the Federal Reserve Bank of Kansas City and the California Department of Financial Institutions, a statement from the Federal Reserve Board Tuesday said. Under the agreement, Community has agreed to take steps to conserve capital and strengthen its loan management. The bank can make no major moves without prior regulator approval and must report back on its condition. The fed also said that Community Bank of West Georgia and First Georgia Community Corp. entered similar agreements with the Federal Reserve Bank of Atlanta and the Banking Commissioner of the State of Georgia on Sept. 11. GMAC LLC reported in an SEC filing Friday that it renewed a $13.8 billion funding facility with Citi. The facility is backed by a variety of automobile assets and mortgage assets across the GMAC and Residential Capital LLC businesses. GMAC has immediate access to $10.1 billion and can access the rest once Citi successfully syndicates the facility. Radian Group Inc. said last week that it completed its $960 million contribution to Radian Asset Assurance Inc., its principal financial guaranty subsidiary. The move reportedly confirms its continuing commitment to the mortgage insurance business. National City Corp. announced Monday that the number of outstanding common shares have increased to 2.1 billion from 760 million as a result of its recently approved conversion of its Series G Convertible Preferred stock. The shares were issued in April as part of a $7 billion capital raise. ViewPoint Bankers Mortgage announced the acquisition of eight mortgage production offices in Texas from CTX Mortgage. The deal included the hiring of 45 loan originators and processors. First Chester County Corp. has agreed to acquire American Home Bank, N.A., a filing Friday with the SEC said. American Home will be merged into subsidiary First National Bank of Chester County. The transaction, which is subject to shareholder and regulatory approvals, is expected to close by the end of the year. Robert Mark, individually and on Behalf of all others similarly situated, Plaintiff, v. Goldman Sachs & Co., JPMorgan Chase & Co. and Citigroup Global Markets Inc., Defendants. Fogel Capital Management Inc., Plaintiff, v. Federal National Home Mortgage Association, Stephen Ashley, Dennis Beresford, Louis Freeh, Brenda Gaines, Frederick B. Harvey III, David Hisey, Karen Horn, Robert Levin, Bridget Macaskill, Daniel Mudd, Peter Niculegscu, Leslie Rahl, John Sites Jr., Greg Smith, Stephen Swad, H. Patrick Swygert and John Wulff, Defendants. Written Agreement by and among Community Banks of Northern California, Tracy, California; Federal Reserve Bank of Kansas City, Kansas City, Missouri; and Department of Financial Institutions, State of California, Sacramento, California. Written Agreement by and among Community Bank of West Georgia, Villa Rica, Georgia; Federal Reserve Bank of Atlanta, Atlanta, Georgia; and Banking Commissioner of the State of Georgia, Atlanta, Georgia. Written Agreement by and among First Georgia Community Corp., Jackson, Georgia; First Georgia Community Bank, Jackson, Georgia; Federal Reserve Bank of Atlanta, Atlanta, Georgia; and Banking Commissioner of the State of Georgia, Atlanta, Georgia.
|
|
|
Â
|
|
|
Sam Garcia worked in mortgage lending for twenty years prior to becoming publisher of MortgageDaily.com. e-mail:Â mtgsam@aol.com |
next story
back to current headlines
