Saturday, April 24, 2010

Meanwhile, in Chicago

A little financial news, courtesy of the Chicago Tribune:

Broadway Bank, the family-owned lender that helped launch U.S. Senate candidate Alexi Giannoulias' political career, was seized by government regulators Friday night, one of seven Illinois institutions taken over and sold to healthier companies.

The failure of Chicago-based Broadway, which was unable to raise the $85 million it needed to remain independent, was anticipated, and its worsening health has weighed on Giannoulias' Democratic bid for President Barack Obama's old Senate seat. The bank had been struggling in recent years with real estate loans gone bad, losing $75 million last year.

It would be amusing if it weren't so sickening -- can you imagine someone whose family ran a corrupt bank that was taken over by federal regulators would fancy himself worthy of a seat the United States Senate? Ah, who am I kidding? He'll fit right in.

One other minor detail worth savoring:

The Tribune reported this month that the $1.15 billion-asset bank, founded in 1979, lent a pair of Chicago crime figures about $20 million during a 14-month period when Giannoulias was a senior loan officer.

Sure, why not? Tell you what -- if the good citizens of Illinois see fit to elect Mr. Giannoulias to the Senate, he should immediately become chairman of the Banking Committee. Or maybe in charge of the stimulus money or something.


Anonymous said...

I happen to agree with you about Alexi Giannoulias being unfit for the Senate seat here in Illinois, and will be voting for Mark Kirk.

Now, can you explain to me why you had no druthers about voting for Norm Coleman at the height of the Financial crisis when it was public knowledge that he had refinanced his home a total of 12 times over the course of 14 years, and qualified to be the poster boy for the financial mess. In essence, he used his home like a giant credit card and is probably still drowning in debt (although maybe not now that he is a lobbyist). Just curious about your take on that.

BTW, Here are the amounts and history of Coleman's financial transaction in re his domus.

Pretty damn reckless, don't ya think?
*Nov. 1994: took out 30-year $172,900 mortgage.

*Dec. 1994: took out 10-year $26,700 second mortgage

*March 1996: took out new 30-year mortgage for $174,000.

*Nov. 1997: took out new 30-year mortgage for $199,250.

*Feb. 1999: took out 30-year mortgage for $203,600. [Coleman Mortgage, 2/1/99]

*Jan. 2000: took out a 5-year $50,000 revolving credit line.

*Oct. 2001: took out 30-year mortgage for $292,000. [Coleman Mortgage, 10/29/01]

*Oct. 2002: took out 5-year $25,000 revolving credit line.

*Aug. 2003: took out 30-year mortgage for $320,000.

*Jan. 2004: revised revolving credit line from $25,000 to $125,000 and extended the maturity date from Oct. 2007 to October 10, 2008.

*Dec. 2006: took out new 30-year mortgage for $423,000.

*March 2007: took out new 30-year mortgage for $775,000.


Mr. D said...


In re Coleman -- it wasn't public knowledge. In fact, this is the first I've heard the extent of Coleman's refinancings. It was never an issue in the campaign and I can think of two reasons why that would be the case:

1) Coleman obviously wouldn't have wanted to talk about it; and

2) If Franken had tried to bring it up, it would have opened the door for a much more aggressive look at his financial shenanigans, especially the fraud at the heart of the Air America launch.

If Norm did all that (and without a cite I'll have to take your word for it, but for the sake of this discussion I will) it doesn't speak well for him. But he still is a better person than Al Franken.

Gino said...

many americans refinance their homes on a regular basis.

they leverage their asset (the home) for any number of reasons. its all legal.
and the tax laws almaost require it in some cases.

i once borrowed 20k to buy a car. i was able to write off the interests that way. if i had a car loan, that would not have been possible, and would have cost more in the near, and long, run.

it can show a somebody who is not reckless, but financially savy instead.
clearly, had had the credit rating to do it.

and obviously, he pays his debts on time.
so whats the big deal?

Brad Carlson said...

Rich, I had heard rumblings during the '08 campaign that Norm had leveraged his home to that degree. Why do you think his D.C. residence was merely a one-room basement apartment in a friend's home? And even that was scrutinized when it was learned that Coleman was paying relatively low rent, given the going rate on D.C. leases. But once people viewed the dwelling with 7-foot tall ceilings, the matter was pretty well dropped.

Anonymous said...

There is a big difference between a guy legally renfinancing and using his assets for leveraging (and from what we've read here, which is all we have), and brining down a bank with loans to people involved in illegal activities. This is kind of like the difference between tax evasion and tax avoidance: One is legal and the other is not. Rich what does your point have to do with the mess in Chicago?

Mr. D said...

There is a big difference between a guy legally renfinancing and using his assets for leveraging (and from what we've read here, which is all we have), and brining down a bank with loans to people involved in illegal activities.

Well, of course. And Rich knows that, which is why he said he would vote for Mark Kirk. But the moral equivalence trope, even when it's a false moral equivalence, is a tough one to set aside. He also likes bashing Norm for some reason.