Citigroup may be able to cash out of another of its problematic businesses. Reuters is reporting that Morgan Stanley may want to buy out their wealth management joint venture this year. Citigroup’s ownership stake in the joint venture is estimated to be worth about $10 billion.
The former CFO of bankrupt mortgage trader Taylor Bean & Whitaker entered guilty pleas to two charges related to false accounting statements. The indictment said the CFO had discovered the accounting fraud at the heart of the business and helped cover it up for a period of time.
The SEC filed a lawsuit today against Wells Fargo seeking to force the bank to turn over documents related to mortgages included in its mortgage-backed securities between 2006 and 2008. The bank says it should not have to provide the documents and will seek to have the court overrule the SEC investigation.
After a week off, bank failures resumed tonight with state banking regulators closing small banks in Illinois and Georgia.
- Premier Bank, 2 branches, Chicago area. International Bank of Chicago is purchasing the assets. The failed bank lent one seventh of its money to Michael’s Fresh Market, a grocery chain that expanded too rapidly, ran out of money, and went bankrupt last year. The bankrupt retailer filed a last-minute suit against the bank today, probably just a tactic to delay an auction of the retailer’s remaining assets.
- Covenant Bank & Trust, 2 branches, Rock Spring, Georgia, in the northwest corner of the state. Minnesota-based Stearns Bank is purchasing the assets and says it plans to keep the two branches open.
A credit union failed tonight. In Colorado, state regulators closed Saguache County Credit Union, which had 3,000 members. Member accounts have been transferred to Aventa Credit Union.
Update: State regulators in California placed Telesis Community Credit Union into conservatorship. The credit union has 38,000 members. It will continue to operate while the NCUA makes changes in its management in the hope of returning it to a strong financial condition.