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Liberty Bank told to cease commercial real estate loans for now

Liberty Savings Bank under federal scrutiny

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By Tim Tresslar, Staff Writer Updated 1:53 AM Tuesday, October 27, 2009

DAYTON — Liberty Savings Bank executives said Monday, Oct. 26, they are working on a plan to increase the thrift’s capital levels and address federal regulators’ concerns over its exposure to commercial real estate loans.

But they also said Liberty Savings remains on solid footing, despite an Oct. 19 order by the Office of Thrift Supervision calling for Liberty to stop writing new loans for commercial real estate or lines of credit secured by such commercial properties.

“We take the OTS order seriously, and we are working with the agency to address the questions it has raised,” Ryan Powell, Liberty’s chief administrative officer, said in a statement.

And in an interview Monday, Powell said the recession and soaring unemployment have resulted in more of Liberty’s loans becoming delinquent even as financial-industry regulators call on banks and thrifts to shrink their commercial real estate loan portfolios.

Powell said Liberty Savings did not make subprime mortgage loans or deal in complex financial instruments that caused problems for other financial institutions.

William Ruberry, an OTS spokesman, declined comment on Liberty Savings Bank.

But the thrift industry as a whole has seen an increase in cease-and-desist orders and other actions.

“Anytime there’s a downturn in the economy, there’s an upturn in enforcement actions,” he said.

According to the OTS, the agency in 2007 issued 20 cease-and-desist orders against thrifts, but the number climbed to 34 the following year. During the first half of this year, the agency issued 37 such orders.

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HA, HA, ATC! A good one!!!! But I smoke Cigars (Pre-embargo Cubans, of course). But your point is well taken. Just remember the collapse of Wachovia and others… Size and age are really markers AGAINST success and survival in this age of CHANGE. But that’s OK… I already made the switch. Glad I beat the stampede. I hope Liberty is a survivor. I’m just not willing to put up with the inconvenience of the federally required merger if and when it occurs.

The Proactive Big Paw
2:31 PM, 10/28/2009

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Liberty has been asked to raise its Tier 1 capital ratio from 7 percent to 8 percent. That is all. The only clients of their bank that are affected are commercial real estate. I read that they are the 12th largest bank in the Dayton area, based on local deposit information from the Federal Deposit Insurance Corp. Stick that in your pipe and smoke it, WPCU(Paw).

around the corner
9:32 AM, 10/28/2009

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That’s odd, ‘The MAN Upstairs’ told me to quickly move all of my money to WPCU! Of course, there is a WPCU branch office on the second floor of the building I’m in.

The Laughing Big Paw
7:58 AM, 10/28/2009

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Palmer,

thanks for the comments, yes it is scary thinking you might lose your job, sleepless nights, no christmas, but I have faith in Liberty, and the man upstairs, I have faith in the owners of the company

stuck in the middle
4:04 PM, 10/27/2009

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Palmer.....Thanks for your comments!!!

Me
3:56 PM, 10/27/2009

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