Breaking News! Breaking News!
The Federal Deposit Insurance Corp (FDIC) has officially seized Colonial BancGroup Inc. (NYSE: ) and will sell it to BB&T Corporation (NYSE: )
The last time I remember anything like this was back in May ‘09 when Bank United Financial Corporation collapsed due largely to adjustable rate mortgages (ARMs) it had doled out dutifully.
And before that, it was Wachovia in December ‘08.
And before that it was Washington Mutual, and before that…
Sadly, it appears that it isn’t really breaking news these days for a financial institution to fail. In fact, the markets barely blink anymore. They’re down today on consumer sentiment apparently, not any banking fiasco and definitely not the consumer actions as reported yesterday.
But that’s another story, and one that I’ve ranted about too many times to count at this point anyway, so I won’t go on about that again. This time at least.
Moving on…
Not that anybody really cares, except for investors of course, but Colonial runs 355 branches distributed between Florida, Alabama, Georgia, Nevada and Texas, with an estimated $25 billion in assets.
Those numbers mean that this particular failure is practically on par with Wachovia. In other words, regardless of whether you’ve heard of it or not, this is not a mom and pop organization.
And a failure of a well-established bank is not the mark of a healthy economy… no matter what anybody else tells you.
Friday, August 14, 2009 — by Jeannette Di Louie
