{"id":239764,"date":"2010-01-27T18:07:36","date_gmt":"2010-01-27T23:07:36","guid":{"rendered":"tag:typepad.com,2003:post-6a00d8341c60fd53ef0128771cf811970c"},"modified":"2010-01-27T18:07:36","modified_gmt":"2010-01-27T23:07:36","slug":"giannoulias-family-owned-bank-ordered-to-raise-more-capital","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/239764","title":{"rendered":"Giannoulias’ family-owned bank ordered to raise more capital"},"content":{"rendered":"

From elsewhere on chicagotribune.com<\/a> <\/p>\n

Broadway Bank ordered to raise more capital<\/h2>\n

By Becky Yerak<\/p>\n

Tribune staff reporter<\/p>\n

Struggling lender Broadway Bank, owned by the family of U.S. Senate
\ncandidate Alexi Giannoulias, has been ordered by U.S. and state banking
\nregulators to raise capital, restrict dividends, review its investment
\npolicies, identify conflicts of interest and hire an outside firm to
\nassess the bank’s top management.
<\/br>
\n
<\/br>
\nThe consent order was signed Jan. 26 and is being enforced by the
\nIllinois Department of Financial and Professional Regulation and the
\nFederal Deposit Insurance Corp.
<\/br>
\n
<\/br>
\nOn Monday the Tribune reported that Giannoulias, current state
\ntreasurer, is entering into the final days of the campaign for the
\nDemocratic U.S. Senate nomination with a significant advantage over
\nrivals Cheryle Jackson and David Hoffman. Despite Hoffman’s attempts to
\ncriticize Giannoulias over loans at Broadway Bank and a $150 million
\nloss in a state college savings fund, the state treasurer has seen
\nlittle erosion in job approval and favorability ratings.\n<\/p>\n

In a letter to workers Wednesday, Broadway executive Kaushik Pancholi
\nsaid accounting rules have forced Broadway to write down the value of
\nmany of its loans and real estate assets. He also said the current
\neconomy and struggles by Broadway customers have hurt the bank.
<\/br>
\n
<\/br>
\n"Additionally, we purchased certain investments that were rated
\ntriple-A by rating agencies when purchased, but have lose significant
\nvalue over the past year," he said. "All of these factors together have
\ncaused a significant drop in our capital levels."
<\/br>
\n
<\/br>
\nGiannoulias said Wednesday he has not been involved in bank operations for nearly four years.
<\/br>
\n
<\/br>
\n"In the midst of a deep recession brought on by bad decisions in
\nWashington and lax oversight on Wall Street, hundreds of community
\nbanks are struggling, and Broadway Bank is no exception," he said in a
\nstatement.
<\/br>
\n
<\/br>
\nOn Dec. 2, the Tribune reported online that Broadway was one of nearly
\n40 Chicago-area banks as of Sept. 30 that had seriously delinquent
\nloans and foreclosed real estate on their books that exceed or come
\nclose to their levels of loan reserves plus core capital.
<\/br>
\n
<\/br>
\nA Texas ratio tallies up a bank’s severely past-due loans and
\nforeclosed real estate and compares them with the levels of a bank’s
\ncore capital, typically shareholders’ equity, and the money set aside
\nfor potential loan losses. A score of at least 80 percent is considered
\na cause for concern. A Texas ratio puts a bank’s asset problems in the
\ncontext of its capital and reserve levels, so it’s considered a good
\npredictor of difficulties.
<\/br>
\n
<\/br>
\nTo lower it, banks need to lower their levels of souring loans, sell
\nthe real estate they repossessed, raise capital or set aside more
\nreserves for potential loan losses.
<\/br>
\n
<\/br>
\nBroadway’s was the 12th highest among local banks, at 187 percent, according to Loan Workout Advisers.
<\/br><\/p>\n","protected":false},"excerpt":{"rendered":"

From elsewhere on chicagotribune.com Broadway Bank ordered to raise more capital By Becky Yerak Tribune staff reporter Struggling lender Broadway Bank, owned by the family of U.S. Senate candidate Alexi Giannoulias, has been ordered by U.S. and state banking regulators to raise capital, restrict dividends, review its investment policies, identify conflicts of interest and hire […]<\/p>\n","protected":false},"author":3992,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-239764","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/239764","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/3992"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=239764"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/239764\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=239764"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=239764"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=239764"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}