Gee, I wonder why every single announcement like this comes late on a Friday evening?
The Federal Deposit Insurance Corporation revealed on Friday that it had issued warnings to four small US banks that lacked sufficient reserves to cover potential loan losses.
The cease-and-desist orders issued in June said the four banks needed to raise more capital, expand their loss allowances and better oversee and diversify their loan portfolios. A fifth bank was cited for violating consumer protection laws.
coincidence obviously.
The FDIC takes over banks late on Friday so they can get them open to the public by Monday. I know it looks like they are just trying to bury the closures in the pre-weekend news feed, but they are actually trying to minimize the disruption to the vast majority of customers who are completely insured, but might want to hit an ATM or write a check on the next business day.
Posted by: Kaleberg | August 05, 2008 at 12:05 AM
as much as I love a good conspiracy, that does make sense!!
Posted by: jkas | August 05, 2008 at 05:58 PM
Yes, that's right. They need time to go through the bank's books and sign the papers with the acquiring back before business reopens. While they are actually doing the accounting (which takes about an hour), the bank's customers cannot get their money by ATM or online, so they do it late on a Friday night to minimize disruption.
Posted by: Jim | October 18, 2009 at 06:28 PM