Posted on 03/18/2009 9:35:35 AM PDT by 2ndDivisionVet
The FDIC has given a negative review to a Massachusetts community bank with no delinquent loans or foreclosures on its books and no anticipated losses. The "needs to improve" rating is a result of the bank being picky about lending, according to the FDIC's interest in the Community Reivestment Act.
Joseph Petrucelli, chief executive of East Bridgewater Savings since 1992, told the Boston Business Journal that his bank is "paranoid about credit quality."
Apparently that will get you a poor rating in the eyes of the FDIC. The agency also faulted Petrucelli for not promoting the bank's loan products enough. East Bridgewater Savings does not have a website and offers fixed rate mortgages.
In comparison to others in the lending business, EBS only made an average of 28 cents in loans per dollar deposited over the last five years while its banking competitors had a 90% average loan to deposit ratio, according to Fox News reports. The bank also turned a profit last year of $87,000.
The rare "needs to improve" rating is a slap in the face to a bank that chose not to make risky loans at the strong suggestion of the federal government. The Community Reinvestment Act is of 1977 is "intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, consistent with safe and sound banking operations." as stated on the act's website.
The key words here are "consistent with safe and sound banking operations." Petrucelli successfully navigated the banking collapse in this country by keep his bank safe and using sound banking procedures. How is that worthy of a poor rating by the FDIC?
The CRA is a major part of why lending in this country is in such crisis. In the late 1970's, U.S. banks began writing loans, and consequently writing off loans, to non-creditworthy customers as a result of the federal government strong-arming them into making poor business decisions. The economic crisis that the Obama administration is so often pinning on former President George W. Bush has deep roots in the Carter years. The practice of writing bad mortgages, loaning money to those who couldn't afford to pay it back, and catering to the whim of Congress is precisely why the American banking system is in trouble today.
A message to our corrupt politicians: Leave our money alone. Leave our businesses alone. Stop punishing success. Let capitalism work.
The way to ruin free enterprise it to throw federal money at it — for that makes it “unfree.”
Where is this bank I have some money to deposit with them.
“A message to our corrupt politicians: Leave our money alone. Leave our businesses alone. Stop punishing success. Let capitalism work.”
TEA PARTY, ERIN????
Also from Erin;
http://nrv.blogtownhall.com/2009/02/16/is_legal_action_possible_to_stop_the_stimulus_package.thtml
one way banks try to avoid the community reinvestment act bureaucrats is to not open any branches in poor neighborhoods, but the ACORN fascists dont like that either
When we went to apply for one of those new-fangled credit card things from our bank, which we'd used for years, we couldn't get one. We had "no credit history." LOL! Talk about being punished for doing something right...
So they either keep 72 cents of every deposit dollar hidden in the vault or they get almost 0% in treasury bills. I have a hard time seeing how they can cover their savings interest much less office expenses and salaries at that low of ratio unless they pay essentially nothing on savings and CDs while charging a lot more than most banks for interest on loans.
People are going about their business, as if it was business as usual.
Confusing.
East Bridgewater Savings Bank
29 Bedford St
East Bridgewater, MA 02333
(508) 378-8400
A ping for you as well. Chapter 10, I think.
Mazel Tov!
“This is getting scary. If the banker’s name turns out to be Mulligan I’m heading for the hills screaming. ;-)”
My thoughts as well (even thought I haven´t finished the book yet).
Hoo-boy. So this is where Eugene Lawson got his inspiration.
Anyone else re-reading that book right now?
Come join the club. We'll be posting Chapter 10 on Saturday morning.
Everyone should invest in a plot of land and get ready to live like a third-world peasant.
We are living in a crazy upside down world.
People are going about their business, as if it was business as usual.
Confusing.
______
I know, I don’t get it either. I find that each day that passes, my desire to get out of here grows.
This proves that the CRA is responsible for the reccession. This bank did not want to be politically correct and give freebies to bums who refused to pay it back and became probably the only bank that did not get losses. So of course the BIG Government would get all nitpicky over this.
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