OMG Who Will Regulate the Sixth District?! Atlanta Fed's Supervisory Monkey Business
Ooopsie, it appears as though I missed this one when it was announced in September. Don't trip, Atlanta Fed, JDA is still riding your nuts and didn't forget. Muahhhz xoxoxoxo!!
William B. Estes III, the top banking regulator for the Federal Reserve Bank of Atlanta, plans to retire at the end of next month after 13 years at the post.
Estes, 60, said his decision was unrelated to reports criticizing the Atlanta Fed’s monitoring of Florida and Georgia banks that failed. He joined the bank in 1975 and has served as senior vice president for supervision and regulation since 1996.
“I’m retiring,” Estes said today in a telephone interview. “I turned 60 a couple weeks ago. I’ve reached all the points you need. That was the reason.”
Fed Governor Daniel Tarullo is leading an overhaul of examinations by the central bank, aiming to identify potential threats across the banking industry. The district banks, formed in 1913, aid in supervising commercial banks and processing checks as well as reporting on regional business conditions.
A search will be conducted to find a successor, Atlanta Fed spokesman Pierce Nelson said. Estes notified the regional bank of his plans late last month, Nelson said.
Riverside Bank of the Gulf Coast in Florida “warranted more immediate supervisory attention” by the Atlanta Fed, wrote Elizabeth Coleman, the central bank’s inspector general in a report last week. In June, Coleman criticized the Atlanta Fed for not being aggressive in its supervision of First Georgia Community Bank.
“More direct and forceful action may have served to reduce an asset concentration” in real estate, she said in her report. The best place is with the Fed.”
Esther George, acting director of the Fed’s division of banking supervision and regulation, agreed with Coleman’s findings. Atlanta Fed spokesman Pierce Nelson last week cited George’s response in replying to a request for comment.
In related Atlanta Fed bank regulation news, Atlanta Fedhead Dennis Lockhart has expressed some concerns over his bank supervisors missing red flags too as the financial crisis has trudged on. As you may or may not be aware, Georgia wins for most bank failures of 2009 (19) with no sign of the shitstorm letting up any time soon. In fairness to the 6th District, Georgia is home to an unusually large number of state and federally chartered banks. But that doesn't really wipe away the taste of FAIL in Atlanta Fed's mouth.
The Federal Reserve Bank of Atlanta is conducting a review of how it supervises banks following the failure of some institutions it examined, Atlanta Fed President Dennis Lockhart said.
“We are looking very carefully at what we can do better going forward,” he told reporters yesterday after a speech in Mobile, Alabama. “We are doing a postmortem, so to speak, to improve how we carry out our responsibilities in supervision and regulation going forward.”
Georgia leads the nation in bank failures this year, with 19. Georgian Bank of Atlanta was closed by state regulators Sept. 25, pushing the U.S. toll this year to 95, according to the Federal Deposit Insurance Corp.
Fed examiners failed to rein in practices that led to losses from excessive real-estate lending at banks in Georgia and Florida that later closed, the central bank’s inspector general said in separate reports since June.
Fed examiners have supervised banks individually without consideration of industry trends that could affect many banks, Lockhart said. That approach is now changing nationally, he said.
“We need to better balance the bank-examination function” and its focus on individual firms “with the focus horizontally on system issues,” Lockhart said.
Fed Governor Daniel Tarullo is leading an overhaul of examinations by the central bank, aiming to identify potential threats across the industry. The district banks, formed in 1913, aid in supervising commercial banks and processing checks as well as reporting on regional business conditions.
Psst, Atlanta, I've got a good one for you.
Why don't you investigate SunTrust? I'm sure you'll find a whole pile of bodies buried in their balance sheet - or is banking supervision and regulation only about skimming off the good meaty bits from the carcass so the FDIC can scrape a meal off of a failing bank's bones? Just curious. Here I thought "supervision" meant pulling out the bitch slap hand when bad banks act up too but hey, I could be totally out of my mind.
I remind dear reader here that SunTrust (STI) also received a fat $3,500,000,000 in TARP money back in November of 2008 (yeah, you read that right).
Remember LandAmerica? Well yes of course you do! The bodies are everywhere, I'm telling you!
So how does LandAm get from mortgage securitization to bankruptcy to lawsuits with SunTrust and accusations of fraud? (I remind dear reader here that SunTrust is regulated by our friends at Atlanta Fed, though I wouldn't expect to see a blog post on why the hell they didn't see a problem with SunTrust coming from a mile away any time soon):Two class actions – one in California and one in South Carolina – were filed against various defendants, including LandAmerica and SunTrust Banks, “on behalf of individuals and entities that sought to enter into a Section 1031 tax-deferred exchange and entrusted money to facilitate the exchange with the qualified intermediary LandAmerica 1031 Exchange Services, Inc.” but who “lost their investment due to alleged misconduct by various defendants, including SunTrust, where most such funds were deposited.” In re Landamerica 1031 Exchange Serv., Inc., Internal Revenue Service § 1031 Tax Deferred Exch. Litig., ___ F.Supp.2d ___ (Jud.Pan.Mult.Lit. June 12, 2009) [Slip Opn., at 1].(source)
I'm not a lawyer so I can't check that particular body for a heartbeat. Point me at a balance sheet and I'll tell you what we're working with here.
Gee, Georgia is quite a ways from Virginia, now isn't it?
Get your damn act together, Atlanta. And hey, good luck finding a sucker to replace Estes!