Georgia’s Banks Continue to Fail; Regulators Completely Useless, Major Part of the Problem

There was a two part series in the AJC about Georgia’s banking commission and how, especially under Rob Braswell’s leadership, has decided to do very little (and I’m being generous), while the state’s banking industry continues to free-fall. (Side note: Sen. Jack Murphy is the senate’s banking chairman. He was in charge of a failed bank, and is being sued by the FDIC for “Breach of Fiduciary Duty” and “Gross Negligence”. Awesome.)

Under Braswell’s laissez-faire approach, Georgia became a national leader in bank failures, with numerous banks publishing their own “recipe for failure”, as today’s report says. Sixty-four banks in Georgia have been seized by the FDIC since 2008, including McIntosh State Bank on Friday. Yay for being number 1?

Sunday’s report went into great detail discussing the commission’s total lack of teeth, how it is far too buddy-buddy with the banks, and how the legislature and executive branch have further chipped away at the commission’s regulatory ability.

Perhaps the best takeaway quote from today’s report is the following from Uriah King, vice president for state policy at consumer advocacy center, the Center for Responsible Lending.

“It’s not like this person is corrupt or that person is corrupt. There’s a bit of race-to-the-bottom dynamic. So a truly independent regulator seems difficult, as a practical matter.”

Your tax dollars truly at work.

Just for comparison… under Gov. Barnes, the state had strict regulations and strong oversight of the banks. Sonny got rid of all that.

Want to read the story? Well you really should. And to do that–go buy a paper. Sorry to make you spend that dollar.


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One response to “Georgia’s Banks Continue to Fail; Regulators Completely Useless, Major Part of the Problem”

  1. JMPrince Avatar

    Nowhere to put this, so as it’s finance related, I guess it goes here:
    http://www.bloomberg.com/news/2011-06-21/georgia-s-1-billion-issue-leads-week-as-sales-slow-over-2010-muni-credit.html

    “Georgia’s $1 Billion Issue Leads Week as Sales Slow Over 2010: Muni Credit” —Bloomberg.

    We’re still looking relatively good by comparison which is still amazing after a fashion. Not a great ‘risk premium’ to be had over the usual US Treasuries either. Which has been the trend.
    JMP

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