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Tuesday, June 18, 2013
Today's Equipment Leasing Headlines
Archives---June 18, 2008
You May have Missed---
######## surrounding the article denotes it is a “press release” and was not written by Leasing News nor information verified, but from the source noted. When an article is signed by the writer, it is considered a “by line.” It reflects the opinion and research of the writer.
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Archives---June 18, 2008
GreatAmerica gets flooded out!
If you were on our mailing list you received a report from
GreatAmerica President Tony Golobic sent out a press release:
"We are continuing to operate and serve our customers with minimal interruption," said GreatAmerica CEO Tony Golobic. "Our primary concern is for the safety and well- being of our employees and uninterrupted service to our customers."
In a previous interview, Chris Walker, CLP, who heads sales for the "broker" direct program group, told Leasing News no one in the building has an office, even the president. Everyone shares communication in open environment. This is done to give their customers access to decision makers."
Perhaps this style was helpful in the move to a back-up facility.
Tony Golobic Receives Leasing News Person of Year Award
Tony Golobic, CEO, GreatAmerica Financial Services received the 2012 Leasing News Person of the Year engraved Crystal Award at the Don Cesar Hotel, St. Pete Beach, Florida, from Leasing News Advisor Bruce Kropschot, Senior Managing Director and Merger & Acquisition Advisory Practice Leader, The Alta Group. Bruce drove up from his home in the Villages with his wife Barbara, about half way from the Golobic's home in Florida, and they had lunch with Tony and Magda Golobic.
(Design, actual crystal award is engraved, difficult to read in jpeg)
Leasing News Advisory Board chose Mr. Golobic "For outstanding leadership and direction, particularly recognizing the management and staff in divisions of executive leaders, office of the president, senior leaders, managing directors, sales leaders, and the various departments of finance/treasury, legal, HR, information technology, corporate communications/Marketing.
Leasing News appreciates Bruce and his wife as well as the Golobics for the photograph.
Leasing Person of the Year Article:
(These ads are “free” to those seeking employment
Free Posting for those seeking employment in Leasing:
All “free” categories “job wanted” ads:
One Out, Another Getting Out, Not the Third
June 6, 2006 James M. Horton, then 54, Grand Rapids, Michigan, former president of CyberNet plead guilty to four felony counts: criminal conspiracy, bank fraud, money laundering and attempting to conceal the whereabouts of $700,000 in fraud proceeds. In the Cybernet scandals, Only $4 million in assets were found with over $114 million in liabilities, many for computers that did not exist. An auction on CEO and founder Bart Watson wine collection and personal items raised over $1 million. He had committed suicide in his wine collection at his Ada township in 2004.
Horton was sentenced this date in 2006 for ten years and with good behavior, was released from federal prison last year (September 28, 2012 at the age of 62).
April 15, 2013, Legal News Editor Attorney Tom McCurnin wrote about U.S. Bankruptcy Judge Jeffrey Hughes added an estimated $9 million to an earlier judgment that calls on Huntington Bank to pay $72 million to victims of the CyberNET 2004 Ponzi scheme (1)
Another person getting off for good behavior is Bruce Donner, 53, getting out of prison on August 1st. He was at the Canaan Penitentiary until this month and is now CCM Community Corrections Office in New York so it may be house arrest for his last month.
Donner was the owner of Donner Medical Marketing, who executed over $135 million dollars in phony vendor invoices for Charles Schwartz's Allied Health Care Services. He plead guilty to crimes carrying a maximum penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense. He was sentenced March 12 to 18 months in prison by Judge Susan D. Wigenton. But with time served before the trial as well as good behavior he's getting out early. (2a,b)
As for Charles Schwartz, he supposedly lost everything, received 16 years and three months, as well as being ordered to pay $80 million in restitution for fraud, as well as to forfeit $75 million regarding $135 million in phony leases. He is at FCI Fort Dix and is scheduled not to get out until 2024.
(1) Huntington Bank Hit with $81 Million Judgment
(2a) Bruce Donner Release Date
(2b) FBI Press Release on Donner Plea:
Swindled List of banks, et. al.
Allied Health Care Stories:
Sheldon Player is a Player at the Tables
(Reportedly Player's favorite game on the Riverboat Casinos)
Equipment Acquisition Resources, Inc. Bankruptcy Petition #: 09-39937 filed on October 23, 2009, a major hearing will be held today, June 18, 2:00pm, Central Time, Courtroom 6, US Bankruptcy Court, Northern District of Illinois, Eastern Division, 219 South Dearborn Street, Chicago, Illinois 60604.
There are 29 pages regarding 21 status hearings, 18 DM Adversary Proceedings, and one conclusion/Administrative matter, which is noted will be continued to the next omnibus status date of July 23, 3013.
Both Leasing News and Lease Police sent out warnings and alerts, including the fact of Player’s conviction for pulling the same stunt with Greyhound Leasing, where he served time in a federal penitentiary.
What is reminded here is not only the loss of money, but the administrative cost of executive time and attorney fees, as the cases wind through the bankruptcy court, settled disputes between creditors and debtors through the process as the main culprit remains free with a lot of cash and certainly continuing to enjoy his lifestyle.
Omnibus Hearing (29 pages):
Those Notified of Hearing (12 pages):
His Favorite Game: Roulette
((Please Click on Bulletin Board to learn more information))
Can Small Business Rely On Community Banks?
(Reprinted with permission from Optirate-
"Res Ipsa Loquitur" – Let the Facts Speak For Themselves.
Numerous news stories and common folklore continues to tell us that Community Banks are the lifeline of financial support for small business. The Independent Community Bankers of America tells us that Community Banks provide 60% of all Small Business Loans.
A recent article in “Bank Investment Consultant” publication stated that Community Banks are “making hefty commitments” to Small Business Lending and quoted a Community Bank executive stating that “Small-business lending is a rounding error at big banks” but a “livelihood” for Community Banks.
Truth be told, on the surface this seems plausible. Yet, we decided to do a bit of fact-checking, and you will not be surprised that certain industry organizations, publications and executives have been taking “poetic license” to describe reality.
According to FDIC, 37% of Small Business Lending is provided by Community Banks. As the chart below shows, Community Banks (those with assets of less than $1 billion) dominate Farmland and Agricultural Lending categories, but taken together these categories total less than $70 million. Community Banks were responsible for just 25% of total commitments of Small Business Commercial & Industrial loans and 40% of Small Business Nonfarm/Non-Residential Loans.
The chart below compares the total Number of Loans Made with the Total Amounts Lent by subcategory of Small Business Lending.
For Commercial & Industrial Loans, Community Banks were responsible for 25% of all dollars lent but accounted for just ~ 10% of Loans by volume. This suggests that Community Banks, on average, made much larger Commercial & Industrial Loans than Larger Banks, which of course, is contrary to the commonly held belief that Community Banks are willing to make smaller loans to accommodate Small Business borrowers.
What is a Finance Lease?
The term finance lease was introduced in 1955 when the IRS issued the first revenue ruling for leasing RR55-540. It represented a transaction that the IRS determine not to be a lease because the “intent” of the two parties to the lease, the Lessee and Lessor, was to create a disguised conditional sales contract (a loan) evidenced by a structure that included a bargain purchase option or allowed the Lessee to use the equipment for its complete useful life meaning the Lessor could no longer use it. Hence a transaction like this looked like a loan so it looked like a financing not a lease.
Then in 1975 when the Financial Accounting Standards Board created SFAS #13 accounting for leases they began to use the term “Direct Finance Lease” to classify a lease for a three party Lessor that meet one of the requirements of paragraph 7. A direct finance lease broke the transaction into depreciation and interest expense. This totally disregards the legal or tax issues and only looks at the economic structure of the lease. Therefore a true tax lease (not a finance lease) could be classified to look like a loan even though the lessee had no right to purchase the equipment at lease termination.
Then in 1988 with the introduction of Article 2A for the Uniform Commercial Code (UCC) the legal profession decided to call the three party legal lease a Finance lease where the Lessor is not held responsible for equipment performance providing the Supply Contract (Vendors warrantees and guarantees) is passed through to the Lessee in the lease agreement.
The term money over money was used by many Lessors’ in the early days because it was clear that if the only return was cash then no tax issues were involved so it was a disguised sale. While this is acceptable for tax issues it still left open the question; is it a legal lease? Also there is a term use in legal to describe a lease that is not an Article 2A lease and therefore is covered by Article 9 that is a “lease intended as a security”. A fancy term meaning it’s a loan not a lease.
Therefore we needed a term that would describe a transaction that fails all the rules and is in fact a financing or a conditional sales contract so we chose “Non-lease Lease” because it describes a transaction that is not a lease but for contract purposes is placed on a lease agreement.
Today it is usually referred to as a "capital lease," meaning the lessee capitalizes the lease, takes the depreciation, although legally the owner of the equipment is the lessor. In an Equipment Finance Agreement, referred to in the industry as "EFA" (pronounced E.F.A.) the owner of the equipment is the debtor and the lender is the creditor. It basically is a loan secured by the equipment.
These types of agreements were popular fifty years ago when most required 25% deposit, as well as were shorter terms, 24 to 36 months, and many states required the APR interest rate be declared on the contract. As leasing became more popular with little money up front and longer terms, the actual rate not declared on contracts, finance agreements were slow to change as the basis of the credit was generally on collateral with the fact the equipment had a long life and the borrower main thrust was to own the equipment. (The leasing philosophy was, " It is not ownership that makes a profit, but the use of modern equipment.")
Particularly in the small ticket marketplace, EFA's appears to have become popular forms of financing today with businesses than a "Finance Lease" due to no "fair market" balloon payment at the end as well as Evergreen clause abuse (additional payments imposed). From a lessors viewpoint, it is similar to a "Finance Lease," but less responsibilities, including warranty or equipment use disputes.
Mr. Terry Winders, CLP, has been a teacher, consultant, expert witness for the leasing industry for thirty-five years and can be reached at firstname.lastname@example.org or 502-649-0448
He invites your questions and queries
Previous #102 Columns:
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Leasing Industry Help Wanted
For information on placing a help wanted ad, please click here:
Please see our Job Wanted section for possible new employees.
“Follow-Up After Sending Resume”
Question: Most of these ads on the internet, say to email or fax a resume. How do you suggest I follow up, by email or telephone, and then what, as for an interview or ask more about the job?
Answer: When making your follow-up call, your goal should be to arrange a time to discuss potential employment via phone and/or to arrange a face-to-face interview, if that is possible.
Don’t be afraid to follow-up, as the email may not have reached the right party, or they may waiting to collect a group of resumes.
You definitely should follow up, but not expect to hold anyone’s attention for an extended period ---so you need to be brief yet thorough. You want to be vague enough to encourage questions. Be able to paint a representation of your skills in broad-brush strokes with examples of your accomplishments.
You need to grab their attention, interest, and desire to know more about you and encourage them to take action. In general, you want to generate an open dialogue and give a brief introduction of yourself. This should include a vague and generalized description of your duties and responsibilities. Secondly, you want to generate some interest by identifying a few of your accomplishments, and finally, request an interview.
Definitely follow-up, as that may be one of the qualifications the company is looking for---taking initiative!!!
Career Crossroads Previous Columns
Wells Fargo Equipment Finance Gets Derailed in
Perfectly Drafted Lease and Assignment to Lessor Results in Surprising Loss at Trial. Case Pits Equities of Case Against Strict Reading of Lease Terms.
Wells Fargo Equipment Finance v Titan Leasing 2012 WL 6184896 (D. Ill. 2012).
It’s not often that the equipment lessor has a perfectly drafted lease and the assignee has a marvelous assignment, and the Court uses those perfectly drafted documents against the assignee.
Today’s case and the resulting decision came as a surprise to me. While the equities were clearly on the Bank’s side, a technical reading of the lease documents resulted in the lease assignee losing against the assignor. This is especially surprising because there was a no default clause (the assignor represents that the lease is not in default) and a representation of delivery and acceptance by the lessee. The lessee had never made a payment and at least from the lessee’s perspective, had never received, nor accepted the equipment. Yet the Court seemed to ignore those facts and ruled on the basis of the written lease and assignment. The facts follow:
Wells Fargo Equipment Finance was an assignee of a railroad locomotive lease, having been assigned that lease from Titan Leasing.
Titan Leasing was the original lessor, having leased the locomotive to Gerdau Ameristeel for use in its Knoxville, Tennessee location in May 2008. The lease had an unusual, but critical provision—the shipment of the locomotive was deemed acceptance of the equipment under the lease. So whether the equipment was late in receipt or defective did not matter. According to the lease, payments were to start upon receipt of possession. So far, so good.
But problems with the transaction happened almost immediately from the signing of the original lease. The locomotive was towed with its brakes on, resulting in massive damage and a several month delay before it could be delivered. In addition, the lessee wanted a remote control unit on the locomotive, and it was sent to a train repair depot for further outfitting. It took a full 9-10 months to repair the locomotive, so it was not delivered for further outfitting until March, 2009. The train depot wanted the locomotive out of its yard, and reluctantly, the lessee took possession of the unit in August, 2009, and it was still not functioning. The lessee became quite sick of the delay, and simply cancelled the lease for lack of delivery in late 2009.
In the midst of this debacle, the lessor Titan assigned the lease to Wells Fargo Equipment Finance in March 2009. The assignment was without recourse, but had some modest representations and warranties as to receipt of the equipment and no default under the lease, mentioned above. Again, so far so good.
What Wells Fargo didn’t know is that the equipment had not yet been delivered by the lessor Titan--- and that Titan and the lessee were in a dog fight over delivery and repairs. Did Titan have a duty to inform the Bank that the equipment had not been actually delivered and might not be in the near future? Ethically, yes. Contractually, no. So Wells Fargo Equipment Finance was in dark on this one.
When the Bank finally figured out that the locomotive had not been delivered, the lessee voluntarily allowed the Bank to repossess the locomotive in June 2010. The Bank filed suit against the lessor and assignor Titan for breach of two representations and warranties: (1) That the equipment had been delivered and accepted (it had not per the lessee); and (2) The lease was in default (payments were to commence upon possession, and the Bank knew the lessee had possession of the locomotive as of late 2009.
The trial court, a United States District Court judge made two unusual findings.
First, on the issue of acceptance and receipt: the Bank argued that the assignor Titan represented and warranted the lessee’s acceptance and argued that the equipment had not been delivered nor accepted at the time of the assignment. That part was true vis-a vis the lessee. However, the Court looked at the lease and discovered that acceptance occurs upon shipment of the locomotive, and that the lessee had the opportunity to inspect prior to shipment, a right apparently not exercised by the lessee. Therefore, there had been acceptance under the lease. Wells Fargo lost that argument.
Second, on the issue of default: the Bank argued that as of the date of the assignment, the lessee had not made any payments and therefore the lease was in default. That was true. But the Court again went to the lease and pulled out an obscure clause that payments were not to commence until possession. Thus, no payments were due as of the date of the assignment, and the lease was not in default. Wells Fargo also lost that argument.
As a result of the two arguments, Titan’s motion for summary judgment was granted, and the Bank’s motion for summary judgment was lost. Titan obtained a Judgment for the defense against the Bank.
While the ruling was surprising to me, it was not so out of context as to be a complete shock. Federal Judges are more swayed by documents than by emotions and appeals to equity. This decision might have gone the other way in a local State Court. It was also a bit of a role reversal to see an equipment lessor like Wells Fargo argue against the language in the documents for which it had bargained. That’s a tough argument for any financial institution to make. To Titan’s credit, its lawyer, Lawrence A. Stein, at Huck Bouma PC in Wheaton, Illinois, stayed focused like a laser beam on the lease documents. His papers rarely exceeded three pages.
There are some anomalies with this decision, summarized below:
The bottom line to today’s case is that when an assignor takes a lease as collateral for a loan, especially a non-recourse assignment, the terms of the lease should be carefully scrutinized, and a lessee’s estoppel agreement should be part of the documentation paperwork. It’s a simple one page agreement, that the assignor should cheerfully provide as a condition of receiving the assignment proceeds.
Wells Fargo Train Case:
Previous Tom McCurnin Articles:
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Largest remaining banks & thrifts in TARP
Columbus, Ga.-based Synovus Financial Corp. and Hato Rey, Puerto Rico-based Popular Inc. — two of the 50 largest publicly traded banks and thrifts in the U.S. — continue to have TARP outstanding, with Synovus still owing the largest outstanding TARP investment of $967.9 million.
Looking at the exit plans of the major TARP holders, Synovus expects TARP repayment will likely occur during the third quarter of 2013. Its unit, Synovus Bank, on April 26 entered into a $30 million senior unsecured term loan agreement with BNC Bancorp, which helped BNC redeem $31.3 million in TARP funds.
"Actions drive us closer to TARP exit in the most shareholder-friendly fashion," Popular Inc. said in a Form 8-K filed April 30.
No. 4 on the list of the largest TARP holders as of June 3, Cathay General Bancorp, said March 20 that it has paid the U.S. Treasury $129 million, plus accrued and unpaid dividends, to redeem 50% of its outstanding series B preferred stock issued under the TARP Capital Purchase Program.
Of the five largest TARP holders among U.S. public banks and thrifts as of Feb. 10, 2013 — SNL's previous examination of the matter — Flagstar Bancorp Inc. and Citizens Republic Bancorp Inc. have since exited the plan. Citizens was the third-largest TARP holder in SNL's previous analysis, with an investment of $300 million. It sold to FirstMerit Corp. on April 12, and FirstMerit purchased from the Treasury all of the outstanding shares preferred stock originally issued by Citizens, including all accrued but unpaid dividends, for a purchase price of approximately $355 million.
Flagstar was the fourth-largest holder of TARP funds in SNL's prior analysis. In an auction that commenced June 3, the Treasury auctioned its warrant positions in the company. It held $266.7 million in TARP. It was previously dropped from a Treasury auction, after the thrift announced an unfavorable court ruling.
Other notable exits since Feb. 10 include United Community Banks Inc. and Old Second Bancorp Inc., the TARP for which was auctioned June 3.
NewBridge Bancorp on May 2 issued notices to redeem 37,372 shares of the company's 52,372 outstanding shares of series A preferred stock issued under TARP. The Treasury on April 18 held an auction to sell all of its TARP investment in the company's series A preferred stock. The sale was settled April 29. As a result, the company is no longer subject to the rules and regulations of TARP. As of Feb. 10, 2013, the company was the 11th-largest TARP holder.
To date, Treasury has recovered $271 billion through repayments, dividends, interest and other income, compared to the $245 billion initially invested through TARP, according to the department's June 6 report.
The Treasury has held 16 rounds of auctions. Its losses spiked in auction 14; the aggregate discount fell to 8.95% in auction 15. Pricing continued to improve in the latest auction, resulting in an 8.26% aggregate discount.
Regulators take 4th chunk of Capitol Bancorp franchise
By David Hayes and Lindsey White and Tahir Ali
Capitol Bancorp Ltd. has repeatedly warned that the failure of one unit could bring down the entire franchise. As of June 6, regulators had seized four of the company's subsidiaries in the space of a month.
The North Carolina Office of the Commissioner of Banks closed Asheville-based Pisgah Community Bank on May 10, and shortly thereafter the Georgia Department of Banking and Finance shut down Valdosta-based Sunrise Bank.
Pisgah Community Bank, Ashville, North Carolina May 10, 2013
Sunrise Bank, Valdosta, Georgia May 10, 2013
In a rare Tuesday failure, the Arizona Banking Superintendent seized Scottsdale-based Central Arizona Bank on May 14. FDIC spokesman Greg Hernandez told SNL that the bank was scheduled to be closed by the state regulator May 10, but the closing was delayed through a legal challenge.
Central Arizona Bank, Scottsdale, Arizona May 14, 2013
State regulators also attempted to close North Las Vegas, Nev.-based 1st Commerce Bank on May 10, but the bank fended them off with a temporary restraining order. The FDIC stepped in and closed 1st Commerce on June 6.
1st Commerce Bank North Las Vegas, Nevada June 6, 2013
All four failed banks were small — as of March 31, Pisgah had $21.9 million in assets and $21.2 million in deposits; Sunrise Bank had about $60.8 million in total assets and $57.8 million in total deposits; Central Arizona had roughly $31.6 million in assets and $30.8 million in deposits; and 1st Commerce had about $20.2 million in assets and $19.6 million in deposits. All four had significant concentrations of commercial real estate loans.
North Carolina's Interim Commissioner of Banks seized Pisgah after the bank failed to come up with a recapitalization plan that did not rely on injections from its holding company. In an Order Taking Possession, the commissioner called the bank's problems "permanent and irremediable."
"Since May 2010, the officers and directors of the Bank have been aware of the problems and deficiencies and have not made appropriate corrections," the order stated.
Pisgah had a 2.48% leverage ratio March 31. At 2.44%, 1st Commerce Bank's was even lower. Among Capitol's remaining subsidiaries, Sunrise Bank of Arizona had a leverage ratio of 2.27% March 31. Bank of Las Vegas, the unit Capitol was seeking to merge with 1st Commerce, had a leverage ratio of 2.21% at the end of the first quarter.
After state regulators appointed the FDIC receiver, Rockville, Md.-based Capital Bank NA, a unit of Capital Bancorp Inc., assumed all of Pisgah's deposits and approximately $19.8 million of its assets.
Columbus, Ga.-based Synovus Bank, a unit of Synovus Financial Corp., assumed about $54 million in deposits from Sunrise Bank and purchased about $13.2 million of the failed bank's assets.
On May 14, Devils Lake, N.D.-based Western State Bank, a unit of Western State Agency Inc., assumed all of the deposits and purchased essentially all of the assets of Central Arizona Bank.
The FDIC signed a purchase and assumption agreement with Irvine, Calif.-based Plaza Bank to acquire all the deposits and essentially all the assets of 1st Commerce Bank on June 6. Plaza Bank is a unit of PB Holdings Inc., whose ownership is shared by funds affiliated with Carpenter Bank Partners Inc.
When the first Capitol Bancorp subsidiary went down, the FDIC declined to comment on whether a failure would trigger cross-liability claims against other Capitol units. "We wouldn't comment on the other institutions, as they are open and operating. And we also wouldn't comment on potential enforcement action," FDIC spokeswoman LaJuan Williams-Young told SNL on May 10.
Capitol Bancorp has warned that the failure of any of its subsidiary banks would have "disastrous consequences."
"If even a single subsidiary bank were to be seized by the FDIC, it is likely that the FDIC would assert cross guarantee claims against the Company's solvent subsidiary banks, thereby crippling these subsidiary banks as well," Capitol Bancorp said in a June 2012 filing.
of Capitol Bancorp units continue to operate. Greg Dingens, executive vice president and head of investment banking at Monroe Securities, said regulators continue to knock off the worst of Capitol Bancorp's subsidiaries but still have not decided to exercise their cross-guaranty rights. He called this a wise strategy, given the situation and the company's unique ownership structure.
"My guess is [regulators] keep doing something like this until they feel like moving on the entire organization makes sense, but they haven't gotten to that point yet," Dingens told SNL.
Cross-guaranty claims have toppled entire franchises in the past. Andrew Christians, vice president at Donnelly Penman & Partners, gave the example of Oak Park, Ill.-based FBOP Corp., which saw nine of its banking units shuttered in one day in 2009. U.S. Bancorp assumed all deposits and most assets of the failed banks.
Of course, there are differences between the two situations. "When FBOP failed, granted, it was [several] years ago, it was much larger, the economy was in a different place, and its geographies were quite a bit different at the subsidiary banks," Christians said.
Capitol Bancorp's ownership structure is also different, and some observers say it may be preventing the FDIC from taking more sweeping action. The company has partial ownership in several banking units spread across the U.S.
Dingens said the FDIC is "breaking their own rules a little bit" to give local investors in Capitol Bancorp's subsidiaries a chance to recapitalize and get out from underneath the holding company ownership. "They're not penalizing the local investors for the sins of the parent as quickly as they might otherwise," he said.
Christians suggested that the FDIC may be in the process of looking for interested buyers for Capitol Bancorp's remaining banking units. "A lot of folks like certain parts of the franchise but don't like the entire franchise. It's a very convoluted structure," he said, adding that the FDIC may be "dragging their feet" on the cross-guaranty liability because of a lack of buyers.
Lansing, Mich.-based Capitol Bancorp has struggled to raise capital for years, restructuring and selling off a number of parts in the process. In August 2012, the company filed for a prepackaged Chapter 11 bankruptcy reorganization in the U.S. Bankruptcy Court for the Eastern District of Michigan, but various challenges forced it to scrap that plan.
In February, the court granted approval for an interim emergency motion by Capitol Bancorp to pursue a $1 million loan to prevent the possible imminent seizure of its Sunrise Bank of Albuquerque unit. Bankruptcy counsel for the company warned that Capitol Bancorp's other banking units "probably would go under" if Sunrise Bank of Albuquerque failed and the FDIC asserted cross-guaranty liabilities.
In a Form 10-Q filed May 15, Capitol Bancorp said it sold its remaining stake in Capitol National Bank in April. Capitol Bancorp said that proceeds from the sale are in escrow pending the issuance by the FDIC of a waiver of cross-guaranty liability. However, the company, in a Chapter 11 liquidation plan it proposed May 16, said the sales of its interests in Maumee, Ohio-based Bank of Maumee and Capitol National Bank remain "pending" and "are subject to regulatory approval and other significant contingencies."
"My understanding is that it's the FDIC's right, but not obligation, to seize other subsidiaries of the same holding company in order to try to recover their funds," Dingens said. "[The FDIC has] been exercising a judgment call and saying, 'I'd rather not take them all down, I'd rather give some of them a chance to be recapitalized independently.'"
Christians said the fact that the failure of four subsidiary banks has not toppled Capitol Bancorp suggests that the FDIC will continue closing one bank at a time, instead of taking down the entire franchise. "If they failed the holding company, I don't know if there would be one buyer for all those assets," Christians said. "So it might be in the best interest of everyone involved for them to allow the banks to continue to operate as community banks, until the time comes where they cannot or there's a capital solution in place."
In the wake of the four failures, Capitol Bancorp Corporate President Cristin Reid told SNL that the company will stay focused on finding positive solutions for its remaining affiliate banks.
Top Stories June 11-June 13
Here are the top stories opened by readers:
(1) Charlie Bancroft Passes Away
(2) More on Capital One Raid SunTrust Staff
(3) Capital One Equipment Finance
(4) Archives---June 13, 2006
(5) CapitalSource Healthcare Finance No Longer in Business
(6) Capital One Raids SunTrust to Beef Up Leasing Unit
(7) Leasing 102 by Mr. Terry Winders, CLP
(8) On Deck Crosses $500 Million Lending Mark
(9) Sales Makes it Happen by Steve Chriest
(Tie) (10) New Hires---Promotions
(Tie) (10) ---Update: Leasing Companies Out of Business
Classified ads—Asset Management
All "Outsourcing" Classified ads (advertisers are both requested
How to Post a free "Outsourcing" classified ad:
“Buddy is a very good dog. We rescued him in Indiana when he was just a pup. We do not live on a farm and he needs to work and play! He is highly intelligent and follows any command. My husband works out of State and I am in Law School. Our children are grown. Buddy spends 24/7 on a run. It is unfair to keep him tied up but we have no choice. There is no fee for adoption we just want him to be happy and see that he has a good home.”
Contact: Amy Bouman 231-580-9449
Michigan Dog Rescue
Adopt-a-Pet by Leasing Co. State/City
Adopt a Pet
Making a Case for Transparent Accounting Information
Embraer Wins 150 Orders as ILFC, SkyWest Buy Newest Jets
At Paris Show, Some Signs of Renewed Demand for Big Jets
The Lending Chill is Gone
Burlington, VT, Lease Default Slows Credit Rating
Huntington Expands Auto Dealer Financing Business into Connecticut
SolSolutions sees market opportunity portable solar generators
Jack in the Box closing 67 Qdoba stores
Napa wine executive accused of embezzling $900,000
Obama Says Bernanke Has Stayed at Fed ‘Longer Than He Wanted’
DirecTV Wants Its $400 From Wiped-Out Colorado Fire Victim
SparkPeople--Live Healthier and Longer
Are You Able to Interpret Food Labels?
by Dan Zamudio
49ers strike deal with Yahoo to enhance stadium experience
NFL roundup: Packers release LB Bishop
Chad Johnson freed after apology to judge
San Jose Based Orchard Supply selling most of its stores to Lowe's
Video of Guide Dogs trio escaping backwards-driving car goes viral
Donkey & Goat " Winery Score Style Points
Bordeaux’s Vinexpo Wine Show Marred by Racist Bottle Attack on Chinese Student
Oregon sets standard for Northwest Pinot Gris
Washington Pinot Gris on a rocketship
Francis Ford Coppola Explains His Passion For Wine
Free Mobile Wine Program
Wine Prices by vintage
US/International Wine Events
Leasing News Wine & Spirits Page
This Day in History
1621-The first duel of record took place between two servants of Stephen Hopkins, one of the leaders of the Plymouth Colony. Governor William Bradford’s decision was rendered as follows: “The Second Offense is the first Duel fought in New England, upon a Challenge at Single Combat with Sword and Dagger between Edward Dotey and Edward Leister, Servants of Mr. Hopkins; Both being wounded, the one in the Hand, the other in the Thigh; they are adjug’d by the whole Company to have their Head and Feet tied together, and so to lie for 24 hours, without Meat or Drink; which is begun to be inflicted, but within an Hour, because of their great Pains, at their own and their Master’s humble request, upon Promise of better Carriage, they are Released by the Governor.”
The object is to insert the numbers in the boxes to satisfy only one condition: each row, column and 3x3 box must contain the digits 1 through 9 exactly once. What could be simpler?
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