The Indymac Slap in our Face

[Arraya]

[quote=davelj]

Let’s see… I’m supposed to take seriously a legal analysis that (1) misidentifies the primary parties to the transaction (What do the Treasury and the taxpayers have to do with the loss-share arrangements?),

[/quote]

First of all, it’s just an article by some guy who works with lawyers on predatory lending cases asking questions about why OWB is acting differently than other banks. He’s not a lawyer presenting a case in a court of law.

Second, I’m sure you can figure out what the treasury and taxpayer have to do with loss-share agreements. The fact that you have to ask speaks volumes. Are you intentionally obfuscating or do you really not know?

For everybody else, WJS calls them a massive subsidy to the private equity industry, and a huge risk to the American taxpayer.

In fact, Wilshire State Bank CEO Joanne Kim said: “After we understood how [the loss-share] works, we were literally overjoyed.”

It simply is taxpayer money going to banks to take over failed banks assets with lots of details in between.

There are numerous articles from reputable sources that cover the loss share agreements.

That really is nothing new or in dispute. Surely banks will find ways to maximize their profit with these agreements. Since it includes access to taxpayer funds, it’s pretty obvious it will be at the taxpayers expense when they do so. Not surprising in the least.

The question about OWB is something else altogether. It’s about the cost to the tax payer and legal intent of the loss share in regards to loan modifications verse straight foreclosure and how they are dealing with that aspect of it.

For some reason OWB has an aversion to loan modifications which from a certain standpoint is good. From a cost to taxpayer and legal intent of the agreement they have with the FDIC it maybe something else altogether.

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[peterb]

If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?

[peterb]

If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?

[peterb]

If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?

[peterb]

If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?

[peterb]

If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?

[davelj]

[quote=peterb]If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?[/quote]

Yes.

[davelj]

[quote=peterb]If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?[/quote]

Yes.

[davelj]

[quote=peterb]If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?[/quote]

Yes.

[davelj]

[quote=peterb]If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?[/quote]

Yes.

[davelj]

[quote=peterb]If the FDIC is really funding this arrangement, how will they pay for it? Member bank premiums?[/quote]

Yes.

[davelj]

[quote=Arraya]

Second, I’m sure you can figure out what the treasury and taxpayer have to do with loss-share agreements. The fact that you have to ask speaks volumes. Are you intentionally obfuscating or do you really not know? [/quote]

I really don’t know. Please enlighten me on this subject about which you clearly know so much. There are two “principals” in the loss-sharing arrangements – the FDIC and the acquiring bank. The FDIC takes the net losses (which hit the Insurance Fund) and such losses will be funded through deposit premiums paid by the banks that don’t fail.

At one point, the FDIC was considering borrowing money from the Treasury in order to replenish the Insurance Fund (in which case you could have argued that the Treasury and taxpayers were in some way involved), but that was politically unpopular (and for good reason), so the current plan is for the banks to pay 3 years of premiums up front. And if the losses are steeper than expected, the banks will just end up paying even greater premiums for a longer period of time.

So, specific to the loss-sharing agreements – let’s not get off course here – where do the Treasury and the taxpayers come in? Please be specific.

[davelj]

[quote=Arraya]

Second, I’m sure you can figure out what the treasury and taxpayer have to do with loss-share agreements. The fact that you have to ask speaks volumes. Are you intentionally obfuscating or do you really not know? [/quote]

I really don’t know. Please enlighten me on this subject about which you clearly know so much. There are two “principals” in the loss-sharing arrangements – the FDIC and the acquiring bank. The FDIC takes the net losses (which hit the Insurance Fund) and such losses will be funded through deposit premiums paid by the banks that don’t fail.

At one point, the FDIC was considering borrowing money from the Treasury in order to replenish the Insurance Fund (in which case you could have argued that the Treasury and taxpayers were in some way involved), but that was politically unpopular (and for good reason), so the current plan is for the banks to pay 3 years of premiums up front. And if the losses are steeper than expected, the banks will just end up paying even greater premiums for a longer period of time.

So, specific to the loss-sharing agreements – let’s not get off course here – where do the Treasury and the taxpayers come in? Please be specific.

[davelj]

[quote=Arraya]

Second, I’m sure you can figure out what the treasury and taxpayer have to do with loss-share agreements. The fact that you have to ask speaks volumes. Are you intentionally obfuscating or do you really not know? [/quote]

I really don’t know. Please enlighten me on this subject about which you clearly know so much. There are two “principals” in the loss-sharing arrangements – the FDIC and the acquiring bank. The FDIC takes the net losses (which hit the Insurance Fund) and such losses will be funded through deposit premiums paid by the banks that don’t fail.

At one point, the FDIC was considering borrowing money from the Treasury in order to replenish the Insurance Fund (in which case you could have argued that the Treasury and taxpayers were in some way involved), but that was politically unpopular (and for good reason), so the current plan is for the banks to pay 3 years of premiums up front. And if the losses are steeper than expected, the banks will just end up paying even greater premiums for a longer period of time.

So, specific to the loss-sharing agreements – let’s not get off course here – where do the Treasury and the taxpayers come in? Please be specific.

[davelj]

[quote=Arraya]

Second, I’m sure you can figure out what the treasury and taxpayer have to do with loss-share agreements. The fact that you have to ask speaks volumes. Are you intentionally obfuscating or do you really not know? [/quote]

I really don’t know. Please enlighten me on this subject about which you clearly know so much. There are two “principals” in the loss-sharing arrangements – the FDIC and the acquiring bank. The FDIC takes the net losses (which hit the Insurance Fund) and such losses will be funded through deposit premiums paid by the banks that don’t fail.

At one point, the FDIC was considering borrowing money from the Treasury in order to replenish the Insurance Fund (in which case you could have argued that the Treasury and taxpayers were in some way involved), but that was politically unpopular (and for good reason), so the current plan is for the banks to pay 3 years of premiums up front. And if the losses are steeper than expected, the banks will just end up paying even greater premiums for a longer period of time.

So, specific to the loss-sharing agreements – let’s not get off course here – where do the Treasury and the taxpayers come in? Please be specific.

[Author]

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