Tag Archives: FDIC

Washington state regulators stepped in to shut down First Heritage Bank in Snohomish late Friday. It was the only closing of an FDIC-insured institution last week but marks the 44th bank failure of the year, and the second in Washington. The FDIC brokered a deal with Tacoma's Columbia State Bank to take over the failed institution's operations.

Potestivo & Associates, P.C., a legal provider in the real estate finance and credit industry, will represent the FDIC as outside counsel in Michigan and Illinois, according to a statement from the firm. The AV-rated firm, which includes more than 100 team members, handles all aspects of default servicing, including residential and commercial foreclosures, bankruptcies, landlord tenant, title resolution, home retention services, REO disposition, and litigation.

Data released by the FDIC Tuesday show that lenders' are seeing considerable improvement in the quality of loans and becoming more confident that fewer borrowers will default. First-quarter loan loss provisions totaled $20.7 billion, less than half the $51.6 billion set aside to cover bad loans a year ago, and loans and leases 90 days or more past due or in nonaccrual status fell for a fourth consecutive quarter. At the same time, though, the number of banks on the FDIC's so-called ""problem list"" is at its highest level since 1993.

State and federal regulators stepped in to shut down two community based lenders in Georgia and one in Washington state over the weekend. They bring the number of FDIC-insured bank failures to 43 for the year. CertusBank, N.A. of Easley, South Carolina, picked up both the failed Georgia banks, Atlantic Southern Bank and First Georgia Banking Company, while Tacoma's Columbia State Bank acquired the failed Summit Bank, based in Burlington, Washington.

State attorneys general are holding meetings with the nation's largest mortgage servicers this week to negotiate a settlement agreement for the robo-signing issues that surfaced last fall. The most controversial piece of the AGs initial proposal - mandated principal write-downs - has reportedly been dropped from the discussions. The primary issue now is the amount of fines to be levied, which the states want to use to help struggling homeowners avoid foreclosure.

Recent news has highlighted the severity of the renewed downturn in home prices, but Capital Economics says although condominiums will not escape altogether, over the next year or so condo prices are likely to fall by less than their single-family counterparts. The research firm notes that demand for condos is currently stronger than demand for single-family homes, due to cash buyers and investors seeking rental income. The condo market also boasts a lower delinquency rate, which suggests fewer foreclosed properties will support the supply of condos.

The FDIC confirmed Monday that Sheila Bair will step down from her post as chairman of the federal agency, effective July 8. Chairman Bair had previously announced her intention to depart the agency following the expiration of her term. No replacement has yet been named.

Federal regulators stepped in this weekend to shut down Coastal Bank in Cocoa Beach, Florida, making it the 40th FDIC-insured institution to fail so far this year. Miami's Premier American Bank, N.A., which is a wholly-owned subsidiary of Bond Street Holdings, Inc. entered into an agreement with the FDIC to purchase essentially all of the assets, and assume all of the deposits and certain other liabilities, of Coastal Bank. According to Premier American, this transaction makes it the sixth largest independent bank in Florida.

In the wake of the industry's robo-signing issues, the Government Accountability Office (GAO) has released a report urging the new Consumer Financial Protection Bureau to make mortgage servicing standards a priority. After examining applicable laws and interviewing mortgage investors and other industry participants, the agency concluded that federal laws do not specifically address the foreclosure process, and as a result, oversight of servicers has been ""limited and fragmented.""

The FDIC has released a special report highlighting what it describes as ""lessons learned"" from the interagency review of foreclosure processes and procedures at the nation's largest mortgage servicers. The FDIC says most institutions that own or service residential real estate loans have been affected by the dramatic increase in foreclosures, but the delinquency rates on loans originated by community banks have been far lower and as a result, ""robo-signing"" practices and process deficiencies are principally isolated to the largest servicers.