Banking Regulatory News

The Federal Home Loan Bank of San Francisco announced December 31, 2009, that the 11th District Monthly Weighted Average Cost of Funds Index ("COFI") for November 2009 is 2.094%.

The COFI is computed from the actual interest expense reported for a given month by the Arizona, California, and Nevada savings institutions members of the Federal Home Loan Bank of San Francisco that satisfy the Bank's criteria for inclusion in the COFI ("COFI Reporting Members").

Changes in interest rates on adjustable rate mortgage loans offered by many financial institutions are tied to changes in the COFI.

WASHINGTON - The senator trying to rewrite the nation's financial industry rules is dropping plans to create a stand-alone consumer financial protection agency and to give a single regulator the power to oversee all banks, according to people familiar with the evolving proposal.

Backing away from the proposal he offered four months ago, Sen. Christopher Dodd, the chairman of the Senate Banking Committee, said the bill he intends to unveil Monday is an attempt at consensus that incorporates Democratic and GOP ideas, even though no Republicans have lent their support.

But he voiced irritation with Republicans in his committee who demanded Friday that he delay committee action on the bill.

WASHINGTON - The senator trying to rewrite the nation's financial industry rules is dropping plans to create a stand-alone consumer financial protection agency and give a single regulator the power to oversee all banks, according to people familiar with the evolving proposal.

Backing away from the proposal he offered four months ago, the chairman of the Senate Banking, Housing and Urban Affairs Committee is now incorporating GOP ideas, and yet not one Republican senator is coming along so far.

Sen. Christopher Dodd's new regulatory scheme, expected to be released Monday, follows months of bipartisan negotiations that abruptly ended last week when he said it was time for his committee to consider a bill.

Despite a last-hour attempt to fend off insolvency, Old Southern Bank failed Friday, becoming the first Orlando-based community bank to succumb in nearly 20 years and only the second since the Great Depression.

With deposits of nearly $370 million, it ranked 19th out of nearly 70 banks in Central Florida in 2009.

Federal regulators took over the bank Friday and sold its assets and deposits to Centennial Bank, based in Conway, Ark. The deal will give Centennial its first presence in Central Florida, although it has 12 offices in South and Southwest Florida.

Mar. 14--RUCKERSVILLE--After nearly a decade in business, a great credit rating, debt-free inventory and top-notch credit scores, Blue Ridge Trailer Sales is having trouble getting a loan as finance companies pull out of the small business credit market and federal regulators increase scrutiny of local banks.

"The long and the short of it is that we are a highly credit-worthy and successful small business that employs eight people -- six of whom are primary breadwinners -- and we can't get financing for spring inventory," Martin said.

"Without adding inventory we do not stand a chance of being profitable."

Mar. 14--To Laurence Kotlikoff, the current debate in Washington over financial-sector reform is missing the mark and by a wide margin.

The Boston University economist, the prolific author of more than a dozen books, has come out with his latest tome, provocatively called "Jimmy Stewart Is Dead," a full frontal assault on the nations current banking system and a call for a complete overhaul of how banks operate.

The point: The quaint Bailey Savings & Loan run by the congenial George Bailey doesnt really exist in today's global banking system, now dominated by hucksters practicing massive financial malfeasance, according to the book.

Mar. 13--Amcore Financial is one of about half a dozen financially ailing Chicago area banks that the Federal Deposit Insurance Corp. is putting up for bids from potential buyers, according to a published report.

The Chicago Tribune, citing unnamed sources, said the Rockford bank, whose 66 branches include 10 in the Madison area, is among those targeted by the FDIC for potential takeover.

Amcore declined to comment on the report, as did an FDIC spokesman.

Mar. 14--The Obama administration says that injecting $30 billion into community banks will help get small business growing again.

The theory is that smaller banks will start to relax as their capital reserves rise and feel comfortable lending to small business again.

Then, the theory goes, small businesses will start to borrow, invest and hire.

Mar. 14--The turmoil that shook financial markets two years ago has dissipated, but the debate over how to regulate the nation's banks continues.

As the Obama administration and members of Congress hash out ways to oversee the banking system, officers of the Federal Reserve and its member banks have been stating a case for keeping the Fed's powers intact.

The Fed, along with the Federal Reserve Bank of Richmond and 11 other district banks, plays a key role in the supervision of large bank holding companies and smaller, state-chartered commercial banks.

Mar. 13--First Independent Bank is suing one of its largest depositors, who has also sued the bank after defaulting on $13.8 million in commercial development loans.

Both lawsuits were filed March 3 in Clark County Superior Court.

Vancouver-based developer Clyde Holland alleges the bank defrauded his business by misrepresenting the bank's financial condition in order to "trap" him into an agreement in February 2009 in which he gave numerous concessions valued at $7 million.