park national bank ( fbop )
park national bank, fbop is on angellist, where the world meets startups .
to connect with park national bank, fbop, sign up for angellist today .
california national bank is unrelated to l. a. - based national bank of california, which has five branches .
sun sets on park national: a rain puddle shows the reflection of park national bank administrators outside the bank friday evening while federal regulators were inside arranging its takeover. jason geil / staff photographer
by 2008, fbop' s three california banks - california national bank in los angeles, pacific national bank in san francisco and san diego national bank - had almost $ 700 million of fannie and freddie stock on their balance sheets; park national' s tally was about $ 100 million, watts recalls .
customers with loans from california national and the other fbop banks were advised to continue making payments .
the bank plans meetings sunday to further brief california national workers, he said .
eight smaller banks owned by fbop, a privately held oak park, ill. , company, were also taken over by regulators and acquired by u. s. bank. they include san diego national bank, with 28 offices, and san francisco' s pacific national bank, which has 17 .
support: employees outside the main branch of park national bank, at 11 madison st. in oak park, on friday, oct. 30, the bank' s last day. jason geil / staff photographer
terry finnegan worked for park national bank for seven years. he left, on good terms, in 2008 to start his own business .
davis, also a democrat from chicago, said park national' s fate was a
shame .
virgil crawford addressing a community meeting in maywood, ill. , where residents are angry that regulators didn’t rescue a local bank, park national .
all deposit accounts have been transferred to u. s. bank national association (u. s. bank), minneapolis, mn (
assuming institution
) and will be available immediately. the former park national bank locations will reopen as branches of u. s. bank during regular business hours .
oak park - based fbop is privately held by kelly, who built the company by making bank deals nationwide. about $ 12 billion of fbop' s assets are in california banks. it also owns institutions in arizona and texas .
regulators seized los angeles - based california national bank on friday night in the country' s fourth - largest bank failure this year .
if you or your company provided a service or product, leased space, furniture, or equipment to park national bank after friday, october 30, 2009 and have not been paid, you do not have a claim against park national bank. please follow your normal billing procedures by providing an invoice as instructed .
neither u. s. bank nor park national was a major originator of mortgages in maywood or the chicago area. but u. s. bank is a custodian of bonds containing those mortgages .
the sad thing about park national bank is that its financial problems resulted from freddie mac and fannie mae' s demise and not from toxic loans. park national invested in what everyone thought were safe investments. it is very sad that the federal government turned its back on this situation .
the 31 branches of park national will reopen saturday under the ownership of u. s. bancorp. the failure of the fbop banks is expected to cost the fdic about $ 2. 5 billion .
regardless of the misfortune of park national bank, mike kelly has made a significant and long - lasting impact on our community that extends beyond the circumstance of today .
that would create
opportunity for selective branch consolidations ,
the bank said in an online presentation on the fbop deal .
the fdic had allowed prospective buyers to make offers for individual fbop banks as well as for the whole company. u. s. bancorp vice chairman joseph otting said u. s. bank was able to work out an offer for all the banks because it already was committed to growing in southern and northern california and in chicago, where fbop owned park national bank .
mr. grace and others say they are well aware that u. s. bank isn’t responsible for all the foreclosures. but they also said that by acquiring park national bank, u. s. bank accepted the community’s expectations set by mr. kelly .
later that same day, fbop' s nine subsidiary banks - including the $ 4. 7 billion - asset park national - were seized by regulators and sold to u. s. bancorp at a steep discount .
west suburban pads was on the receiving end of mike kelly and park national bank' s generosity for many years. i' ll never forget meeting mike for the first time .
there was no immediate word on layoffs, but u. s. bank sought to allay fears at california national .
but u. s. bank officials say they are dumbfounded that they are being singled out. “we agree that foreclosures are a huge problem, ” says steve saloutos, executive vice president of u. s. bank’s midwest division. “it’s not a park national problem, or a u. s. bank problem, but a national problem. ”
mike kelly and park national bank understood that there was more to banking than single - minded profit seeking. before the term
community banking
was popular, mike was practicing it .
while park national is no longer with us, the individuals that made park national what it was, including mike kelly, are still part of the community. it is too early to say what the full impact of park' s passing will be, but the people of park national will continue to support the community and will do all they can to ensure that u. s. bank steps up to the plate. it will never be the same, but that spirit of service is, perhaps, the best legacy that mike kelly has left us .
in july 2009, the agency notified the fdic of its intent to close seven of the nine banks. park national and the $ 120 million - asset citizens national bank of teague in texas were not included on the list, but park national was cited as a
deteriorating problem institution with financial and managerial weaknesses ,
mitchell glassman, director of the fdic' s division of resolutions and receiverships, testified to congress .
fbop' s owner, billionaire michael kelly, didn' t return a call seeking comment .
he said he eventually approached u. s. bank to see if it would take over park national’s commitments. u. s. bank sent a team to the school to meet students, and it eventually decided to substantially match park national’s commitments — not only money but also jobs for students. “you couldn’t argue with the value of what the school was doing, ” says mr. hartnack .
your transferred deposits will be separately insured from any accounts you may already have at u. s. bank for six months after the failure of park national bank. checks that were drawn on park national bank that did not clear before the institution closed will be honored as long as there are sufficient funds in the account. if you have questions about your account (s) transferred to the assuming bank, you may speak to an fdic representative by calling 1 - 800 - 450 - 5668 .
federal banking regulators should have given park national bank and fbop corp. more time to see if it could come up with capital to regain its solvency. [ fbop corp.' s banks taken over by feds, web extra, oct. 30 ] after all, unlike other banks which made unsound loans in unsteady markets, fbop' s downfall was to invest in fannie mae and freddie mac - not exactly speculative investments as most people would understand that term. help was on the way .
it also is the biggest illinois institution whose banks have required government intervention since continental illinois in 1984. park national and community bank of lemont are the 18th and 19th illinois banks to be seized this year .
california national bank, with $ 7. 8 billion in assets and $ 6. 2 billion in deposits, is the fourth - largest commercial bank based in los angeles county. only city national corp. , east west bancorp and cathay general bancorp are larger .
the timing was awkward. the government shut down $ 4. 8 billion - asset park national on the same day that its community development arm, park national bank initiatives, received $ 50 million from treasury secretary timothy geithner in chicago on friday. that money is intended to stimulate investment in low - income communities for such projects as charter schools, health clinics and stores .
across the country, many have bemoaned the loss of locally owned banks, worrying that a faceless national bank will have little interest in a community — aside from making profits. perhaps nowhere has that issue played out more publicly than in the chicago area, where mr. kelly’s park national bank was as well known for its philanthropy as for its financial products .
claims against failed financial institutions occur when bills sent to the institution remain unpaid at the time of failure. if you or your company provided a service or product, leased space, furniture, or equipment to park national bank prior to friday, october 30, 2009 and have not been paid, you may be entitled to a claim against the bank. if you provided a product to or a service for park national bank prior to the bank' s failure for which you have not been paid and you have not received communication, please contact :
the park national shutdown occurred after several illinois congressmen, including reps. bobby rush and danny davis, and u. s. sen. roland burris called the fdic asking it to delay closing the bank for at least a week, said marilyn katz, a bank spokeswoman .
for most of this decade, i have had the privilege of working at park national bank, an organization that was so much more than a bank. it was a vital part of oak park and the greater chicago community. it played a vital role in economic development, housing, education and financial services in underserved, economically depressed neighborhoods throughout chicago .
the driving force behind that activity was mike kelly. he was not alone, however. his commitment and generosity inspired that same spirit in those who worked with him. many park national employees volunteer and serve on the boards of oak park nonprofit organizations. park national and its employees have provided significant financial resources to many area organizations through corporate and individual contributions, and through the provision of financial products to meet their needs .
fbop was still in good shape as the second quarter of 2008 ended. just over a month later, fannie and freddie were seized, reducing the value of some $ 885 million in securities to zero overnight. several weeks later, fbop lost another $ 100 million when wamu failed. fbop had purchased wamu paper when it was rated investment grade. in less than a month, fbop had lost 63 percent of its tier 1 capital .
by the fdic' s calculations, if park national and citizens failed later - a distinct likelihood, given the volume of loan participations among the banks - the total cost would be $ 2. 91 billion; applying the cross - guarantee provision and seizing park national earlier lowered the cost to $ 2. 54 billion, saving the fund $ 316 million. and so park national joined a list of failed institutions that now numbers more than 200 since the fall of 2007, and still has a ways to grow .
u. s. bancorp of minneapolis, through a loss - sharing deal with the federal deposit insurance corp, . will assume all the deposits and most of the assets of the nine failed banks, including park national bank of chicago .
mike kelly put the community first with his bank in a supportive role of community objectives. whether it was quick action on behalf of village government or continued support of our local nonprofit groups, park national was truly a community - wide partner .
fbop was built from scratch by kelly, an aggressive but intensely private entrepreneur. he bought first bank of oak park in 1981 and then made a career of swooping in on ailing banks in chicago and the sun belt, buying them cheap and improving their results dramatically .
but there are two losses here beyond a new name going on an old bank. park national was unusually aware of its community, and creative in providing financing that would help not only oak park, but also austin and other neighborhoods, including pullman, to build new assets in their communities. that local focus and community awareness is now gone .
the company acquired nearly 30 troubled institutions at bargain prices over the years. those rehabilitation projects gave kelly three small banks in texas and one in arizona, and a $ 12. 5 billion - asset, three - bank california franchise to complement park national .
park national bank initiatives is redeveloping 200 acres in pullman and has provided zero - interest loans for christ the king jesuit college prep and chicago jesuit academy. in west garfield park, it' s a partner with bethel new life and thrivent financial to offer banking products to low - income consumers. it has also partnered with neighborhood housing services of chicago .
i thought that if and when the moment came i would be sad. resigned. depressed. and yet when the news really sank in saturday morning, i became furious. raging. apoplectic. park national bank and its parent corporation, first bank of oak park corp. , had been shut down by the federal deposit insurance corp. regulators swooped in friday night and branches were re - opened saturday under the u. s. bank flag. fdic officials and u. s. bank employees were on hand to calm fears, answer questions and put on a good front for customers and bank staff alike .
in chicago, where fbop also owns community bank of lemont, it is a lesser player. it has 33 total offices and local market share of 1. 24 percent, ranking 14th .
at the meeting at hope church, mr. hatch applauded u. s. bank for making some steps, like investing in schools. but like many others that night, he dispatched with niceties, and threatened to send busloads of protesters to u. s. bank’s headquarters in minnesota unless it started acting more like park national .
fbop has total banking assets of $ 19. 4 billion, which made it the third - biggest bank owner headquartered in illinois, after hsbc north america holdings inc. and northern trust corp .
for more than a decade, a silver - haired banker from river forest named michael e. kelly — owner of park national bank in the chicago area and eight others around the country — took an unusual interest in maywood. he did things most bankers don’t do .
as the first new catholic high school on the west side in 85 years, it owes its existence to michael kelly, but when park national folded last fall, christ the king’s future suddenly looked bleak .
the 68 - branch bank, a unit of fbop corp. , was immediately acquired by the u. s. bank unit of minneapolis - based u. s. bancorp, with no losses to be incurred by depositors, the federal deposit insurance corp. said .
i consider mike kelly one of oak park' s gems. the news of his bank being taken from him is one of the most unjust stories i have heard .
jackie leavy, a founder of the coalition to save community banking, said the bank hadn’t been transparent in its intentions. for instance, she says, u. s. bank has taken over and renamed park national’s nonprofit arm, which rehabbed homes and redeveloped blighted areas, but has declined to say how much money it is putting into it .
at christ the king jesuit college preparatory, the school to which park national pledged a no - interest loan, the bank is seen as a hero. the school caters to motivated low - income students who agree to work one day a week to cover most of their tuition costs .
the nine fbop banks had combined loans and other assets totaling $ 19. 4 billion as of sept. 30, the fdic said .
on friday, october 30, 2009, park national bank, chicago, il was closed by the office of the comptroller of the currency, and the federal deposit insurance corporation (fdic) was named receiver. no advance notice is given to the public when a financial institution is closed .
mr. kelly’s banks were also known for generous charitable donations and a commitment to low - income areas, particularly in the chicago area. for instance, park national pledged a $ 27 million, interest - free construction loan to build a jesuit preparatory school in austin, a predominantly african - american neighborhood that abuts oak park .
before the downey and pff deals, u. s. bank had 79 branches in the los angeles - orange county area, a spokeswoman said. the fbop acquisitions will bring its total in the area to 241 .
all of the banks, especially park national, were reflections of kelly' s values, and he clearly liked calling the strategic shots. he owned 100 percent of fbop, and sold only debt - mostly trust - preferred securities - but never equity, to maintain control. he also ran at a very low tangible equity ratio, providing relatively less room for error .
the los angeles - based, 68 - branch bank is immediately acquired by the u. s. bank unit of u. s. bancorp .
but, of course, park national is now out of business. so are mr. kelly’s other eight banks, which were also acquired by u. s. bank last october. the federal deposit insurance corporation said the cost of the failures to its insurance fund was $ 2. 5 billion .
sorry to hear about the fdic takeover. park national was a good friend to the north avenue business association. they were very generous in supporting our programs through the involvement of their employees as board members and by attending our functions .
u. s. bank officials, clearly vexed by a groundswell, say they intend to honor all of park national’s outstanding commitments. but they also say the level of charitable giving will probably decline to match donations in other areas where u. s. bank has branches. because of the complexities of the modern mortgage business, the bank also says it has little legal ability to modify local mortgage loans that it did not originate but for which it acts as trustee .
in a story that has gained much notoriety in chicago, the treasury secretary, timothy f. geithner, awarded a park national subsidiary $ 50 million in tax credits on the morning of oct. 30, 2008, to help the bank finance schools, retail development and a community center on the city’s south side .
“the determinations to place the fbop banks into receivership were consistent with, or required by, the statutory scheme congress put in place, ” she said .
mr. hartnack also points out that fbop concentrated its donations in the chicago area. u. s. bank, he said, tries to spread donations fairly among its more than 3, 000 bank offices across the country. as a big publicly traded institution, u. s. bank also has to consider shareholders who would undoubtedly frown if 20 percent of its profits went to charity .
u. s. bank, though, has made some friends in chicago .
“it’s probably reasonable to expect some diminishment in total giving but not reneging on commitments, ” mr. hartnack says of his bank’s takeover of fbop. “we’ll gradually not make as many new ones until we get the numbers in balance. ”
otting said representatives of his bank met friday evening with california national employees at all the branches, telling employees who work face to face with customers that they could keep their jobs and back - office workers that they would be allowed to apply for other jobs at u. s. bank .
park national also helped to create a community savings center on the west side of chicago that provided low - cost banking services and financial counseling to people who normally don’t use banks. and it set aside $ 20 million to help homeowners facing foreclosure .
u. s. bank’s evolving policy in the chicago area has created a fair amount of angst, in part because the bank donates 1 to 2 percent of its profits. besides its donations, the bank provides billions in community lending and investments .
while fbop was bigger than the typical community bank, its tale has emerged as exhibit a in a growing national debate over washington' s handling of troubled small banks. in january, a congressional subcommittee used its collapse as the centerpiece of a hearing - subtitled
examining the failure and seizure of an american bank
- that brought testimony from kelly, several regulatory officials and west side community development leaders, some of whom bussed all the way from chicago .
learn if your bank is insured, view locations, track history, and more .
eight months after park national’s closing, anger continues to boil, in part because of the unusual circumstances surrounding its demise. and residents rankle because the federal government decided to bail out megabanks like citigroup, deemed “too big to fail, ” while letting a beloved community bank go under. in that context, outrage — and hyperbole — reign .
but it' s a subjective exercise. park national itself had a 9 percent capital ratio, considered
adequate ,
according to watts. moreover, community leaders and some members of chicago' s congressional delegation argued that this relative health, combined with a mission of supporting underserved neighborhoods, earned the bank some additional time to find capital .
mike was not defined by park national - it was a reflection of him. he is a generous and caring person who touches many lives. he is a great leader and wonderful role model. i am sure we have not heard the last of mike kelly .
there' s more than a little irony that kelly, the grandson of a banker who committed suicide during the great depression, found himself in this predicament. a workout specialist who honed his skills in the 1970s with wells fargo & co. predecessor minneapolis - based northwestern national bank, kelly bought the faltering first bank of oak park in 1981, and within a decade transformed it into one of the top - performing banks in the country .
please see a borrower' s guide to an fdic insured bank failure for additional information .
in early september, the fdic began marketing the seven banks on a standalone basis and in combination with each other. to test the waters, park national and citizens were offered, without a loss - share agreement, but no takers were found. on october 20, the agency received 41 bids from 18 bidders for some or all of fbop. the best deal for the seven banks in immediate danger would have cost the dif $ 1. 85 billion .
fbop banks also provided $ 583 million in that two - year span for community development loans, including such things as affordable housing and inner - city redevelopment, he told congress .
when the credit and real estate markets subsequently fell apart, the deterioration of fbop’s loan portfolio, particularly in commercial real estate, accelerated, federal regulators testified at the january hearing .
kelly said fbop had been working to obtain $ 750 million from private investors but was unable to present an acceptable proposal to the regulators when a deadline for raising capital expired friday .
according to congressional testimony and former colleagues, mr. kelly took over the first bank of oak park in 1981, and built it into an enterprise with about $ 19 billion in assets, largely by buying failed or underperforming banks .
he also ensured that the bank was there when the village board needed credit for special projects. finally, he was supportive not only of oak park theater groups but also the many other nonprofits that add to our quality of life .
along the way, fbop distinguished itself by doing good. nearly one - third of its 150 branches were in low - to - moderate income areas. six of the banks, including all of the big ones, received
outstanding
cra designations. in 2007 and 2008, fbop banks made $ 55 million in
community donations and investments ,
kelly testified .
if you had a loan with park national bank, you should continue to make your payments as usual. the terms of your loan will not change, because they are contractually agreed to in your promissory note. checks should be made payable as usual and sent to the same address until further notice. if you have further questions regarding an existing loan, please contact your loan officer .
i can' t even begin to list the individuals and organizations mike kelly supported. he opened up branch banks in austin because he saw a need and not because he was forced to because of a discrimination lawsuit. the loss of park national will be felt for many years to come .
the $ 18. 3 billion - asset fbop had more than half of its balance sheet invested in the preferred stock of fannie mae and freddie mac - a capital strategy that was approved, some would even say encouraged, by federal regulators. when the treasury department abruptly placed the government - sponsored mortgage giants into conservatorship in september 2008, fbop' s capital levels plunged .
mr. hartnack, the u. s. bank executive, says that his bank has won over customers in the many markets it has entered over the years, and that it eventually will do so here. but he said big banks will never be mistaken for the old corner bank .
in some ways park national was like our very own bailey building & loan, and mike kelly was our george bailey / jimmy stewart. you' re a good man, mr. kelly; thanks for a job well done. your institution deserved a better fate, and so did we .
“fbop’s business strategy — which had previously been successful — left the bank vulnerable to the perfect storm of events that the fbop banks could not survive, including unforeseen and devastating g. s. e. losses, ” testified jennifer c. kelly, senior deputy comptroller for the office of the comptroller of the currency, the primary regulator for many of mr. kelly’s banks. fannie and freddie are known as g. s. e. ’s, or government - sponsored enterprises .
they didn' t seem to take the components apart and ask,' what will this do to our local community?'
says steven mccullough, president of bethel new life, a chicago community - development organization that worked closely with park national .
our question is, why was a financially successful, model community - based bank not only allowed to die, but prevented from saving itself ?
“this was the finest community bank in america, ” says the rev. marshall hatch, a leader in the community banking coalition. “the loss of the bank is incalculable for our side of town. ”
he ended up owning nine banks in texas, california, arizona and illinois, all under the umbrella of his bank holding company, the fbop corporation. it was the largest privately held bank - holding company in the united states and, before 2008, recorded 25 consecutive years of profits, according to mr. kelly’s testimony before congress in january, in a hearing prompted by the closing of his banks .
california national has had its share of lending problems. as of june 30, the last time it reported its financial results publicly, the bank had five times as much foreclosed property on its books and twice as many non - current loans as it had a year earlier. but the bank' s main problem was its loss on the fannie mae and freddie mac preferred shares .
over time, i came to appreciate the work of park national as i learned of the bank' s investment in developing affordable housing and charter schools for low - income residents on the west side of chicago, and, of course, his famous philanthropic work for local charities. the housing crisis has left devastation vast and wide in its wake at all socioeconomic levels, and from the heights of corporations to our neighbors next door .
for all questions regarding new loans and the lending policies of u. s. bank, please contact your branch office .
fbop didn' t get involved in subprime mortgage lending, but did have a knack for turnaround situations and working out troubled loans. attempts to reach kelly for this story were unsuccessful, but in his congressional testimony he noted that the company posted record profits for 25 straight years, and had historical net loan losses that were about one - quarter the industry averages. in their 2008 examinations, all nine fbop banks were well - capitalized with solid regulatory ratings, he added .
river forest resident michael kelly built a banking empire over three decades, making himself wealthy. on friday night, it all came tumbling down in spectacular fashion, as the government seized the nine banks run by kelly' s fbop corp .
in any case, the loss of park national is more painful because i think most of us feel so helpless. we couldn' t prevent the takeover, even with strong support from our representatives in the u. s. house and senate; so we' re left wondering
what next ,
and to that end, i don' t think we know .
he says it’s a frustrating situation for the bank to manage, because it is essentially in the position of cleaning up other people’s mistakes. “do you isolate the bank that is the last one to put a sign on the building? ” he asks .
protesters recently rallied against u. s. bank at a vacant apartment building in austin, the neighborhood near oak park; the bank is trustee for the bonds backed by the property. the back door was ajar, and a pipe in the basement spewed water. the apartments were littered with dog feces and the detritus of past lives: birthday streamers over a doorway, a girl’s pink coat on a hook, computer monitors and dishes .
as just two examples, a few years ago he saw to it that our local head start program did not leave oak park by ensuring that it had a home. he also forged a unique relationship with bethel new life, the multi - issue community organization in east garfield park, so that west side chicago residents could be assisted in saving for housing and education .
in total, mr. kelly’s banks donated a total of $ 36. 7 million to charitable causes in 2007 and 2008. fbop, the holding company, chipped in a further $ 17 million in those two years, according to his congressional testimony .
when mr. mcghee, a vice president of u. s. bank, stood to address the crowd, he was interrupted with angry questions and chants. “we are very much aware of the impact park had on this community, ” he said. “that is not lost on us. we’ve taken copious notes. ”
kelly and his team immediately committed to raising enough money to get fbop' s individual banks back to well - capitalized status. at the time, the company' s credit quality still looked relatively good, and there was serious investor interest in the company .
william fanter, left, and robert mcghee, both of u. s. bank, listened to the complaints of politicians and residents .
“it is virtually impossible for a very large company to attain that same level of affection that a community bank has, ” he says, suggesting that the local banking model has become somewhat antiquated as more consumers bank online. “it’s a charming part of our financial history. ”
“basically, it amounts to the largest bank robbery in the history of the united states, ” says david pope, the oak park village president. as the new owner of mr. kelly’s banks, u. s. bank has become the unwitting lightning rod for local politicians and activists. they demand that the bank, whose parent, u. s. bancorp, had profits of $ 2. 2 billion on revenue of $ 16. 7 billion last year, curb foreclosures and replicate mr. kelly’s philanthropy (which involved giving nearly 20 percent of annual profit to causes like education and affordable housing) .
as fbop chairman and ceo, mike built and ran his banks with extraordinary integrity, a commitment to social justice and generosity. but perhaps what is so special about mike is his personal involvement, accessibility and close - up care for the well - being of others .
regulators have acknowledged the role of the gse conservatorships in the failures of fbop and some other institutions, but say rules are rules, and the fdic' s primary mandate is clear: maintain the system' s stability, while minimizing the costs to the deposit insurance fund .
mike understood that a healthy bank requires a healthy community, and vice versa. we have suffered a loss. who will now step forward ?
fbop' s troubles began in late 2007, as the crisis was gaining traction. in her congressional testimony, jennifer kelly described a series of
strategic decisions that, in retrospect, diminished the company' s financial flexibility and exposed the banks in the company to failure .
when people read about the fate of fbop, i hope they understand that behind the story there is an incredible man, michael kelly, who has supported our community. he has put his money behind our business ventures, supported our nonprofit agencies and developed services in other communities .
in 2003, the oak park public art advisory commission invited its friends and neighbors to our first cheney mansion fundraising dinner, for which we requested a hefty contribution to support the beginnings of the commission. we also introduced our concept of having a collection of public sculptures and murals throughout oak park. we reached the final week before the autumn dinner and were told any funds we had raised that were deposited with the village could not be used to pay for wine. it was a fundraiser' s nightmare, until the light went on that there was one person in oak park whom we could call in a pinch - mike kelly .
u. s. bank officials say they are still working out the numbers and don’t feel compelled to share news of every donation with community activists .
this is a shock and a shame. they have always been a major supporter of oak park festival theatre and other groups in the community. it sounds as if the feds should have waited another week or two .
it looks as though the fdic is just not satisfied that the bank has the $ 600 million in new private equity that would take care of its capitalization needs ,
said davis, who thought fbop had lined up needed capital .
we' ve been engaged in it all day, and the last call i made was to the white house, but i don' t know the extent to which they can get involved .
the determinations to place the fbop banks into receivership were consistent with, or required by, the statutory scheme congress put in place to resolve banks... at the least cost to the deposit insurance fund ,
senior deputy comptroller of the currency jennifer kelly testified during the january hearing .
you may withdraw your funds from any transferred account without an early withdrawal penalty until you enter into a new deposit agreement with u. s. bank as long as the deposits are not pledged as collateral for loans. you may view more information about u. s. bank by visiting their web site .
taking such losses into account, the fdic estimated that friday' s nine bank failures would cost the federal deposit insurance fund $ 2. 5 billion .
the collapse of fbop' s banks, attributed to losses on securities issued by the giant mortgage companies fannie mae and freddie mac, was the latest in a rash of financial failures that began last year with government takeovers of 25 banks. before friday, 106 u. s. banks had failed this year .
he had other problems, too. for years, he had prospered by scooping up other banks in times of trouble or lending when others pulled back. he followed the same instincts as the mortgage crisis began to go into overdrive, allowing fbop’s banks to expand their loan portfolio by 35 percent between 2007 and 2008 .
given the circumstances, u. s. bank officials said they contacted the originator of the mortgage, wells fargo, and urged it to board up the building .
on a tour of maywood, lennel grace works through a list of foreclosed homes for which u. s. bank is either originator, trustee or servicer. at some of the stops, members of the coalition to save community banking have put signs on the door that read, “another u. s. bank foreclosure. ”
fbop had hoped last fall that it could get money from the treasury department' s $ 700 - billion financial bailout fund, kelly said. but in the end, he said, changes in the program
meant that we were no longer eligible .
a treasury spokesman couldn' t be reached friday for comment .
one speaker, the rev. randall harris, led the audience in a rowdy chant. “u. s. bank! ” he shouted. “step up! ” others vowed more vigorous protests unless u. s. bank complied with community demands, which include establishing a $ 25 million fund to help stave off foreclosures. “we are ready to sit down inside your bank until you take action, ” said the rev. michael stinson. “it’s going to get real ugly before it gets pretty. ”
when a private - company option became available in mid - november, the office of the comptroller of the currency recommended to the interagency council overseeing applications that fbop be approved. but that council requested additional information. in the interim, the company' s loan quality began to deteriorate precipitously, and the occ withdrew its support .
with that in mind, fbop began shifting its capital into a more
safe, liquid form ,
that could be sold quickly if the right chances emerged, watts says. that turned out to be fannie and freddie preferred shares, which had a better yield than treasury securities and were rated aaa - minus by the ratings agencies .
those close to michael kelly say he viewed the financial crisis as another opportunity to buy distressed banks. most of his previous deals came during bad times for struggling institutions that could be had on the cheap .
m & a was part of our history, and there was a feeling that acquisition opportunities would be coming our way ,
says watts, now president of $ 180 million - asset forest park bank in suburban chicago .
last fall, mr. kelly’s private banking empire collapsed, and his profitable, time - tested playbook as a banker and philanthropist failed amid his own misjudgments and the brutal headwinds of the financial crisis. at the direction of federal regulators, his nine banks were acquired by u. s. bank, the nation’s fifth - largest bank, based in minneapolis .
the way in which mike personally directed the bank' s resources to help so many people is a powerful example to all of us of how to become a man for others .
the company tried to obtain additional capital, first from the capital markets and later the troubled asset relief program. but it was thwarted multiple times by government actions as it pursued tarp .
the rules kept changing ,
recalls daniel watts, park national' s former president .
we thought early on we' d get the money, and we didn' t. then we thought we had it a second time, but didn' t... . the ring just kept getting moved a little further from our grasp until we ran out of time .
bank officials say that as trustee, they have no authority to try to restructure mortgages. but that reasoning has done little to appease critics, who say banks are just passing the buck .
mr. kelly said regulators urged him to apply immediately for tarp funds and gave him verbal assurances that his application would be approved. but the first round of tarp money was directed at publicly traded banks, not private entities like fbop, and mr. kelly didn’t receive any aid. he testified that a second application for tarp funds stalled as regulators kept changing the criteria .
all interest accrued through friday, october 30, 2009, will be paid at your same rate. u. s. bank will be reviewing rates. you will be notified of any changes .
the company grew its loan portfolio 35 percent during the year ended in the third quarter of 2008, filling a gap in a commercial real estate market that other banks thought too risky. it also bumped up loan participations among its various banks. in hindsight, such moves
limited fbop' s financial flexibility and ability to absorb losses ,
the occ' s jennifer kelly testified .
however, in my observation, the biggest loss to us is fbop owner michael kelly, who in addition to running his banks responsibly, also quietly provided financial and moral support to local people and agencies that needed it. like everything else he has done, most of these good deeds were done below the radar of publicity, because that isn' t mike kelly' s style .
online tool that helps how the insurance rules and limits apply to a depositor' s specific group of deposit accounts—what' s insured and what portion (if any) exceeds coverage limits at that bank .
the branches, mostly in los angeles and orange counties, were set to reopen as usual saturday or monday as branches of u. s. bank, which has been expanding rapidly in southern california .
also, the facility at north and austin was a great gateway into our business district. we hosted several business networking events at the bank; we even got free checking! while the community may suffer from the loss, it pales in comparison to the losses incurred by the employees, customers, shareholders and creditors of the bank. the north avenue business association wishes everyone involved good luck in the future .
whether fbop is a good choice for the role of industry martyr is another matter of debate. the company made its share of strategic mistakes, before and during the crisis, and got some help from nongovernmental sources. an ongoing lawsuit, for instance, accuses jpmorgan chase & co. of sabotaging the company' s capital - raising efforts last may by calling a $ 246 million loan prematurely .
a board member arranged for him to visit us at our office, then in forest park. he was gracious and listened to me explain the work of our agency in a small, no - frills office. i was aware that he was an iconic, yet elusive, figure in oak park and river forest, but i had no idea at the time of our meeting how deep his good will, influence and generosity ran. a man of his stature would generally mean layers of subordinates before you could reach him, but that wasn' t the case. he answered his own phone and returned calls promptly .
ely also is unmoved by the capital woes of fbop and other banks snared by collapses of fannie and freddie. while the regulators had approved the holdings, the gses' potential demise had been rumored for months .
the question should be,' why were they so heavily invested in the stocks of those two companies?'
he asks .
you can' t let the regulators make decisions for you .
“he’s from river forest, o. k. ? ” says lennel grace, a fourth - generation maywood resident. “if you talk to people in river forest or oak park, they say, ‘oh, poor maywood. ’ they kind of look down their nose. he’s not that kind of a person. ”
members of the coalition have also criticized u. s. bank for what they say is its hands - off policy on housing foreclosures. but the bank is in a difficult situation in that regard, given the structure of the mortgage market. individual mortgage loans were long ago pooled into bonds and then sold to investors as a means of — in theory — reducing investors’ exposure to mortgage losses and therefore allowing banks to underwrite many more mortgages .
what galls watts and other observers most is an apparent lack of flexibility on the government' s part. fbop' s franchise included seven banks in california, arizona and texas that were undercapitalized. under the so - called cross - guarantee provision of firrea, the federal deposit insurance corp. is required to seize all banks in a holding company if that appears to be the most cost - effective solution for the deposit insurance fund .
just when it was looking like the company would raise the money, however, tarp' s capital purchase program was announced. the cpp created confusion in the market, and ground most capital - raising efforts to a halt. most agree that fbop would have been a strong candidate for early tarp funding that october. but treasury didn' t have an option for private companies, because warrants were a big part of the equation .
u. s. bank, with $ 265 billion in assets, has 57 offices in the chicago area and market share of 0. 85 percent, ranking 19th. combined, they will rank 11th in the chicago area .
he remains a strong advocate for village partner agencies. as i sat across the table from him during discussions about village funding support for oak park development corp. , i witnessed the mettle of a man who stood up for what he believed, looked at key long - term community goals and encouraged all of us to reach higher .
u. s. bank is acquiring most of those assets under a loss - sharing plan with the fdic, which is to absorb 80% of the first $ 3. 5 billion in losses and 95% of any additional losses .
whereas some of the nation’s biggest banks nearly collapsed under the weight of risky loans and dubious underwriting, fbop’s big problem, according to mr. kelly and his regulators, was that it invested nearly $ 900 million in what appeared to be sure - thing, blue - chip investments — preferred stock in fannie mae and freddie mac, the government - sponsored mortgage giants. those investments were considered so safe, in fact, that government regulators encouraged banks to invest in them .
your automatic direct deposit (s) and / or automatic withdrawal (s) will be transferred automatically to your new bank. if you have any questions or special requests, you may contact a representative of your assuming institution at your branch office.
another , entirely separate park national bank is a chicago-based bank owned by fbop corporation , with branches in chicago and several nearby suburbs . the chicago bank failed on october 30 , 2009 , and was taken over by the federal deposit insurance corporation , with the bank 's assets later being sold to us bank . 
another, entirely separate park national bank is a chicago-based bank owned by fbop corporation, with branches in chicago and several nearby suburbs. the chicago bank failed on october 30, 2009, and was taken over by the federal deposit insurance corporation, with the bank's assets later being sold to us bank.
another, entirely separate park national bank is a chicago-based bank owned by fbop corporation, with branches in chicago and several nearby suburbs. the chicago bank failed on october 30, 2009, and was taken over by the federal deposit insurance corporation, with the bank's assets later being sold to us bank.