The FDIC has just today finally updated its regulatory watch list, increasing the number of problem banks from 90 to 117. We have been looking for this revision to guage how the industry is moving. The news 
report I read indicates that the banks added to the list are larger players.
While the number of banks increased from 90 to 117, the combined assets increased brom $26 billion to $78 billion. Additionally, banks have had to set aside more that 4 times the loss provisions than were required in the 2nd quarter last year.
The impacted banks increased the number of troubled banks by 30%. The assets held by the troubled banks more than doubled.
This will impact liquidity for all types of lending.
This annoucement comes with a couple new reports that home prices have fallen by a record amount this quarter, as compared to a year ago.
These reports follow immediately upon the announcement yesterday that home sales have increased.
There were even headlines that the Housing Crisis Over? July Sales Spike. A closer read of the actual article by Alan Zibel shows that much of the increased sales was bargain priced foreclosures, and that actual housing inventory has increased to record levels.
Combining this with the loss of programs, and the imminent ban on seller funded down payment with FHA loans, and prices must drop. There are just not enough buyers.
I hope that those in charge are paying attention and can put these numbers together.
Richard Smith
American Acceptance Mortgage, Inc
Toll Free 888-474-9920 Cell 423-280-0345
Home financing in Tennessee, Georgia, and Alabama.
Experience matters when it is your home loan.
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Richard Smith Conventional, FHA, FHA 203k, HUD $100 down purchases, VA, Jumbo VA, Rural Development, Jumbo, FannieMae Homepath, Home Equity Line of Credit (HELOC). |
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that is just what we are seeing here, prices are going down, but the homes are selling fast.
WoW Richard... It is amazing at the number of banks making this list.. Thanks for keeping us posted
Konnie,
The national trend seems to be increasing inventories, more going on the market that there are buyers for. One report showed a national supply of over 11 months.
Is that consistent with Northern Va?
BTW, I am from Virginia, and my sister and her family live in Fredericksburg.
Richard
Roland,
For me the significant number is the large increase in the assets of troubled banks. That indicates there are some large players on the list. There have been some reports pointing at some large banks.
Richard
Richard,
The troubled bank list certainly is troubling. It could mean that if any of the large players starts feeling really ill, the feds have to step in again.
Esko,
I am sure they will have plenty of money for all this. How about you? I did read somewhere some economists saying that the GSE's might not require a bailout.
I know the stockholders would be glad for that.
Richard
It seems as though we are all in the same boat. This is actually pretty scary stuff, with banks, fannie and freddie, the value of the dollar, oil prices, unemployment, etc. We are in difficult times to say the least.
Richard,
Thanks for the post great work. Very beneficial information. Important to realize that there will be many more lenders who will become casualties. However, the flurry of buying activity will help to spur on the market.
FDIC recently took over a local bank, and I heard couple others are in serious trouble. Think it will still get worse before better. Hopefully though we are getting close to bottom!