The economy - from the disastrous to the obscene
Wall Street’s biggest banks may be roaring back to life, but trouble still lurks in corners of the financial industry that remain plagued by a legacy of bad investments.
On Friday, Colonial BancGroup, a large lender that rode the excesses of the nation’s real estate boom, was seized by federal regulators, making it the largest bank failure of 2009 and one of the most costly since the collapse of IndyMac Bancorp last year.
Regulators simultaneously brokered a rapid sale of its branches and deposits to BB&T Corporation of North Carolina, a regional bank that has emerged from the financial crisis as one of the industry’s strongest players. The failure is expected to cost the Federal Deposit Insurance Corporation about $2.8 billion.
Regulators also closed four other small banks on Friday in Pennsylvania, Nevada and Arizona, bringing the total number of bank failures to 77 this year. Banking analysts say that the number of failures could easily reach several hundred in the next 18 months as rising commercial real estate losses take their toll.
while obscene bonus payouts fly in formation with taxpayer bailouts...
Senior Obama administration officials were wrestling on Friday with how to handle an explosive executive pay issue involving two traders’ compensation package of nearly $130 million that Citigroup says is exempt from government review.
Citigroup’s decision leaves top White House and Treasury Department officials unable to do much about some of the highest-paid employees at the deeply troubled bank just two months after the administration announced, with great fanfare, the appointment of an official to crack down on lucrative payouts at companies that have become wards of the state.
On Friday, Citigroup, which is facing a government deadline, submitted the pay packages for its 25 senior executives and highest-paid employees. People involved in that process said Citi advised the Treasury that an energy trader named Andrew J. Hall, due $98 million, was exempt from federal review, and so was a second unidentified trader who received more than $30 million.
Mr. Hall, 58, and the other trader were paid under an employment contract signed last October, said a person briefed on the contract who was granted anonymity because of not being authorized to disclose the information. That was before a law went into effect instructing the Treasury secretary, Timothy F. Geithner, to examine the pay packages of top executives at companies that received exceptional bailout assistance from the government.
a $98M pay package...?!?! unbelievable...! Submit To Propeller
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