Another Friday has passed, which means another bank has gone bye-bye

[marmar]

Franklin Bank closed, 18th failure this year

By John Letzing, MarketWatch

SAN FRANCISCO (MarketWatch) -- Houston-based Franklin Bank S.S.B. was closed by regulators Friday, the 18th bank failure this year amid the ongoing credit crisis.

The Federal Deposit Insurance Corporation said in a statement that Franklin Bank had total assets of $5.1 billion as of Sept. 30 and $3.7 billion in total deposits.

El Campo, Texas-based Prosperity Bank will assume Franklin Bank's deposits for a premium of 1.7%, and Franklin's 46 offices will reopen as Prosperity branches, the FDIC said.

In addition, Prosperity Bank will purchase roughly $850 million of Franklin Bank's assets, according to the regulator.

The FDIC estimated that Franklin Bank's failure will cost its Deposit Insurance Fund between $1.4 billion and $1.6 billion.

Shares of Franklin Bank slid more than 80% lower in after-hours trading, to $0.04 cents.


http://www.marketwatch.com/news/story/Franklin-Bank-taken-over-18th/story.aspx?guid=%7BE41B1E9A%2D4EDB%2D484C%2DB96D%2D7FC5B77C4DD6%7D

[Pale Blue Dot]

1. It was 2, actually.

Regulators shut banks in Texas, California

WASHINGTON (AP) — Regulators shut down Houston-based Franklin Bank and Security Pacific Bank in Los Angeles on Friday, bringing the number of failures of federally insured banks this year to 19.

The Federal Deposit Insurance Corp. was appointed receiver of Franklin Bank, which had $5.1 billion in assets and $3.7 billion in deposits as of Sept. 30, and of Security Pacific Bank, with $561.1 million in assets and $450.1 million in deposits as of Oct. 17.

The co-founder and chairman of parent Franklin Bank Corp., Lewis Ranieri, is credited with inventing mortgage-backed securities two decades ago, but apparently was unable to save his own company from getting ensnared in the home-loan bust.

The bank's failure is a bitter irony because it is the mortgage securitization business of which Ranieri is known as a pioneer — the repackaging of home loans as bonds that are sold to investors — that was at the heart of the mortgage and credit crises. Last spring, the audit committee of the company's board found in an investigation certain weaknesses in accounting, disclosure and other issues relating to residential real estate loans.

Franklin Bank Corp. just Sunday said it had received proposals for transactions to strengthen Franklin Bank's capital position and was keeping regulators informed of the talks' progress.

http://ap.google.com/article/ALeqM5gKCQTU4OBly0RqaHE8bEjNYOeBPAD94AJ5JO0

[Mr_Jefferson_24]

2. True enough -- this list shows two...

http://www.fdic.gov/bank/individual/failed/banklist.html

[Nikki Stone1]

3. Thank you for reminding us. I've K & R'd you.

:kick: