National City – Bank In Trouble With Regulators And Shareholders
Mortgage Insider » Banks » National City – Bank In Trouble With Regulators And Shareholders
National City Corp (NCC), a large Midwestern bank which during the real estate boom boasted a healthy income from their wholesale mortgage division, got in trouble with the bank regulators back in June and are now being sued by their stockholders.
National City – Bank Under Scrutiny
The Office of the Comptroller of the Currency issued National City a memorandum of understanding which allows the government to pressure banks to fix their financial problems early on hoping to avoid panicking the depositors. This gives the bank time to raise capital or curb high risk lending or both to come back into favor with the OCC.
It seems the higher risk mortgage and home equity division of National City is at least part of the problem, but the Reuters report claims neither the OCC or National City would comment.
National City – Shareholder Lawsuit Filed
Yesterday in Florida state court a class action lawsuit was filed against National City alleging securities violations stemming from the companies acquisition of Fidelity Bankshares, Inc.
Marketwatch reports,
“According to the complaint, the Registration Statement filed in connection with the Fidelity Acquisition contained materially misleading statements and omissions relating to: (a) the Company’s disclosures of billions of dollars of risky construction loans; (b) the Company’s classification of loans in its portfolio as nonperforming; (c) the understatement of the Company’s loan loss reserves and (d) the misstatement of the Company’s financial results.”
To get a copy of the complaint, you may contact the court, or call Berman DeValerio at (561) 835-9400.
This is not a good sign for National City – bank regulators and shareholder lawsuits – even one could take down a bank, but to have both going at the same time…
Only time will tell…but it looks like just another example of the mortgage meltdown taking it’s toll.
Good Luck!
Author: The Mortgage Insider
Date: August 27, 2008
Tags by Post Bank Failures, Mortgage Crisis, Mortgage Meltdown
Technorati Bank Failures, Mortgage Crisis, Mortgage Meltdown
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I’ve had NCB for 12 years now and they have changed the greedy rules in their own favor to help steal money from working people. When did this **** of depositing a check and now the bank will only let $100 of it become available and hold the rest until the next 24 hours and cause people to now bounce? Also, what the heck is overdraft protection when the bank still charges 36.00 and also 15.00. That does not sound like overdraft protection.
I’m closing my account this week. NCB can fall into the hole they made but I’m not going with those greedy pigs.
Susan,
As long as it’s in an insured account…it’s safe up to the FDIC limit…which I believe is now $250,000.
If you have more than that on deposit…spread it between 2 FDIC insured banks.
RKB
Is my money safe at this time