Pigs Get what Pigs Deserve

I have a couple of thoughts about banks and bailouts. I was opposed to the bailout because it insured the fat bastards that got us into this mess would emerge whole and unscathed. Their bad acts have gone unpunished. And they continue to reward themselves with gluttonous bonuses. All of this earned on the backs of normal people. BP Chairman Carl-Henric Svanberg (not a banker, I know) said this of what I call normal people: "we care about the small people. I hear comments sometimes that large oil companies or greedy companies that don't care, but that is not the case at BP. We care about the small people." Big banks and big oil care a lot about small people, you bet they do.

The big banks continue to deal with the foreclosure mess which they themselves created. It's a numbers game to them. And the staffs (inside the banks and outside contractors) crunch the numbers so that the result of whatever individual deal they are working on produces an acceptable result for the bank.

And it is not just the big banks that function this way. One local bank was acquired by an out of state banking system a while back. Then it acquired another local bank that was shut down by the FDIC earlier this year. The new bank spends lots of money on local advertising and seeks new business. Loan officers do what loan officers must do in small banks, they join service clubs and participate in community organizations to "reach out" and encourage new banking relationships.

This same bank has a huge number of bank owned properties acquired through foreclosure. You would think it would have all of those assets listed with local Realtors so that the non-earning assets could be sold. I used to manage bank owned assets for a big bank in Denver. I know what I am talking about. This is not "theory". It is dogma.

Mr. Potter - the ultimate sting banker

Instead this particular bank holds its bank owned assets in its stingy bankers' hands and ineptly tries to sell the banks with "bank owned" signs placed on the various properties. A phone number to an out of state location may connect an interested buyer with a special assets person who may have information on the specific property. Maybe.

Now I know the local person who is responsible for these properties. But when I call this person, the voice mailbox is always full and will not accept my phone message. If I call the local bank I am referred to the special assets departmetn in another state. When I call there I am told a local bank person will call me to schedule a showing. Eventually I will get a call back and we can perhaps see the property. In a recent instance the bank person did not show up for our appointment. He called later in the day and by chance we had just finished our last appointment. We scooted over to the property when I asked a couple of pertinent questions like "What is the price? " To which he answered I would need to talk to Special Assets in the far away state. Outside the presence of my buyer I asked "Will the bank pay me a 3% commission if I produce a buyer?" To this he answered he doubted the bank would be that generous.

A few months ago I wrote about a property that same bank owned in Old Town. It was not listed with a Realtor, and I spoke with a senior bank official directly about that asset. I produced what I thought was a very good, clean offer to purchase the property. I even delivered the contract to banker's house just as he requested. Later when I had not received any response from him, I called him back. He said the Special Assets person would respond to me. That did not happen. So I made calls to Special Assets. My calls were not returned. I called the senior bank official again and reminded him that I used to do the same type of work for a really big bank. I said that if I had failed to respond to a written offer that way I would have been fired. Within minutes I got a phone call. My buyer's offer was countered by the bank. The counter: full price. A few months later the bank listed the same property with a local Realtor at a price less than what my buyer offered months earlier.

I used to refer my buyers to a great banker that works at that same bank. No more. It is not personal. It's business. As nice and as competent as the banker is, I want to do business with individuals and businesses that I like and trust. I don't trust this bank. There are two other local banks that I refer buyers to plus a national bank that is getting a big Florida presence. Why should I send my buyers to deal with a bank that does not want to deal with me and my fellow Realtors fairly. I'm not talking just about listings. I'm talking about pricing, availability to show properties, to have good competent knowledge of what the bank is offering for sale, and to offer fair market compensation for producing a buyer.

Key West is a small town. This particular bank is sitting on millions of dollars of non-earning assets. It spends money and time trying to get new business but refuses to list most of its bank owned properties with local Realtors. It's business plan sucks.

Pigs Get what Pigs Deserve.