BankUnited Fails, Will Cost FDIC $4.9 BILLION...Who is going to BAILOUT THE FDIC

Discussion in 'Wall St. News' started by S2007S, May 22, 2009.

  1. S2007S


    FDIC is going to need a bailout sooner or later, who is going to pay for that.....................

    BankUnited Fails, Will Cost FDIC $4.9 BILLION
    Joe Weisenthal|May. 21, 2009, 6:26

    After several tense days, during which Florida bank BankUnited scrambled to raise capital or sell itself, it has been shut down, put into receivership and sold to investors that include Wilbur Ross and the Carlyle Group.

    It is the biggest bank failure of 2009 and it will cost the stretched FDIC $4.9 billion.

    The FDIC's full announcement is here.

    So how does the biggest bank failure since IndyMac square with what's putatively a stabilizing or "healing" banking sector, with a LIBOR rate that's returned to pre-crisis levels? Easy. The government is backing the entire thing up, and even with this failure (which the FDIC calls the "least costly" approach), bank investors are being ring-fenced and backstopped to all get out.

    When the training wheels come off the sector, then we can get some clue about what's stabilizing, but in the meantime, events like these aren't very promising.
  2. The Fed.
  3. CET


    If you knew how the FDIC is funded you would know the answer to your question. Surely you don't think this kind of news scares anyone at this point.
  4. S2007S


    From FEB 2009

    A higher rate of bank failures is increasing strain on the FDIC's resources. The agency's insurance-fund balance dropped by almost half in the fourth quarter, from $35 billion to $19 billion. To keep funds from dwindling, the FDIC is going to raise deposit-insurance assessment rates beginning in the second quarter of 2009, adding to the burden that already-troubled banks will have to bear.
  5. Daal


    The bailout already occured, the got their credit line increased with the treasury
  6. It was a preemptive bailout!
  7. The Fed has over a 2 Trillion dollar balance sheet. Do you honest-to-god think they aren't going to backstop the FDIC?

    For F's sakes people....