Fund Run: Montana and Florida

"Montana fund sees $247 mln of withdrawals: Florida's investment woes spark subprime fears in other states"

and

And update on Florida's (LGIP) fund: "Florida Halts Withdrawals From Local Investment Fund (Update3)"

So, will this turn into fund run across US (and other countries)? The mind boggles...

Copyright 2007, DannyHSDad, All Rights Reserved.

Broken Down Under

"12th New Zealand non-bank finance company collapses"

Capital + Merchant Finance, New Zealand nonbank financier, on Thursday became the nation's 12th finance company to collapse in less than two years. U.S.-based creditor Fortress Credit Corp., owed around 70 million New Zealand dollars (US$54 million), called in receivers after Capital + Merchant had breached agreements with the Australian branch of Fortress, which has a prior charge over assets.

US problems pulling down companies in Southern Hemisphere, too.

Copyright 2007, DannyHSDad, All Rights Reserved

Fund Run: Municipals losing money and pulling out of funds

It seems that runs are starting on funds at least at the state level:

1. Florida School Fund Rocked by $8 Billion Pullout -- turns out some State funds were invested in SIV's which have lost money in the last few months. So local governments pulled out and those who are still in it may not get back their principle!
2. Maine Treasurer Criticizes Merrill for Subprime Bet -- seems that ML lead them astray and made Maine lose money.
3. Caisse de Depot Has C$13.2 Billion Invested in Commercial Paper -- Canada's biggest pension fund manager also has C$1 Billion in subprime loans.
4. As towns go broke, subprime crisis hits Arctic Circle -- "A Norwegian brokerage that lost its license over its role in turning four remote towns around the Arctic Circle into victims of the U.S. subprime crisis said Wednesday that it would file for bankruptcy."
   

What a nice bunch: all blaming the US subprime "problem."

Copyright 2007, DannyHSDad, All Rights Reserved

Run on the Funds

CR has been covering the fund issues, like "GE Bond Fund Breaks the Buck" which isn't about a money market fund (MMF) but is supposed to be similar to a MMF. Unfortunately, with the higher returns, you have to take higher risk and in this case, the risk resulted in a slight loss.

In similar vein, MarkeWatch has "Is your MMF safe? (Mounting concern about money-market funds: Investments seen as safe and secure face threat from bad debt holdings)." Some funds are suffering and companies have had to provide some support to prevent the funds from "breaking the buck." For example, Bank of America announced that it will pour in $600 million to prop up some funds.

Copyright 2007, DannyHSDad, All Rights Reserved.

FDIC Closures: 2

FDIC bank failure list has few updates:

1. NetBank September 28.
2. Miami Valley Bank October 4.
   

Copyright 2007, DannyHSDad, All Rights Reserved.

NCUA closures: 5

Here are 5 which were closed since I last posted:

1. Cal State 9 Credit Union in Conservatorship since November 2.
   
2. Green Tree Federal Credit Union closed November 2.
3. Peoples First Choice Federal Credit Union in Conservatorship June 12.
4. Sharebuilders Federal Credit Union closes April 25.
5. Obelisk Federal Credit Union Placed in Conservatorship April 17.

Copyright 2007, DannyHSDad, All Rights Reserved.

Non-bank shut down: Federal Savings

"Unlicensed agency sold high-interest securities" has a very sobering news:

But Seattle-based Federal Savings had all the appearances of a bank. Its Web site carried what looked to her like a Federal Deposit Insurance Corp. logo, and she assumed that meant deposits were insured by the government agency.[...]

Federal Savings is not registered in the state of Washington or with any federal agency to sell certificates of deposits or any securities, said Martin Cordell, chief of enforcement with the state Department of Financial Institutions' securities division.

Two weeks ago, after investigating complaints about the company, DFI issued a cease-and-desist order against Federal Savings, First Bancshares Inc., JMA Northwest Investments and Jeremy M. Stamper, a Seattle businessman.

Ironically, their web site claims that they are "the unbank" -- and turns out they were not a real bank afterall. So, you don't have to be a real bank to collect money! How many other "unbanks" are out there?

Copyright 2007, DannyHSDad, All Rights Reserved.

Meaning of NCUA and FDIC

"Learning the Finer Meaning of 'Insured': Banks and other institutions offer various guarantees on their investment products."

A good intro on who insures what for how much.

Copyright 2007, DannyHSDad, All Rights Reserved.

Bank 2: Huron River Area Credit Union, Ann Arbor, MI

"Feds take over credit union: Problem at Huron River Area Credit Union not disclosed" [Feb 20, 2007] NCUA takes over a bank in MI.

Copyright 2007, DannyHSDad, All Rights Reserved.

Bank 1: Metropolitan Savings Bank, Pittsburgh, PA

"Customers saw 'no rumblings of trouble' at bank" [Feb 11, 2007]. FDIC takes over a bank in PA.

Copyright 2007, DannyHSDad, All Rights Reserved.

Bank Run Tally: Start

I want to keep a running tally on banks going under. This includes regular banks and credit unions.

Copyright 2007, DannyHSDad, All Rights Reserved.