The U.S. economy is showing signs of recovery, but despite that fact, the number of bank failures in the U.S. has continued to increase with 123 entities going out of business so far this year. The authorities shut down three banks - Orion Bank based in Naples, Pacific Coast National Bank in San Clemente and Century Bank F.S.B of Sarasota on November 13, taking the count of failed banks to 123 this year, according to PTI.
The Federal Deposit Insurance (FDIC), which was named the receiver of the failed banks, took over Orion Bank, with about $2.7 billion in assets and $2.1 billion in deposits and Century Bank with $728 million in assets and $631 million in deposits. Pacific Coast National Bank was also shut down. It had $134.4 million in assets and $130.9 million in deposits. In addition, FDIC had entered into a purchase and assumption agreement with Iberia Bank of Lafayette, Louisiana, to assume all of the deposits of Century Bank, FSB.
However, the maximum number of collapses this year took place in July, when 24 banks were closed down, while 20 entities bite the dust last month.
Despite the slowly improving economic situation, soaring unemployment rate have resulted in rising defaults, primarily impacting the small and medium banks.
Agencies
Showing posts with label collapse. Show all posts
Showing posts with label collapse. Show all posts
Monday, November 16, 2009
Tuesday, April 7, 2009
Has IBM pulled out of $7b offer for Sun Microsystems?
IBM withdrew its $7 billion bid for Sun Microsystems on Sunday, a day after Sun’s board balked at a reduced offer, according to three people close to the talks.
The deal’s collapse after weeks of negotiations raises questions about Sun’s next step, since the IBM offer was far above the value of the Silicon Valley company’s shares when news of the IBM offer first surfaced last month. Sun, an innovative pioneer in computer workstations, servers and Internetera software, has struggled in recent years and spent months trying to secure a suitor. With IBM and others shying away from a deal, a bruised Sun could be forced to continue pursuing a solo business model whose prospects have been questioned by many analysts.
After the legal review, IBM shaved its offer on Saturday from $9.55 a share, the proposal on the table late last week, to $9.40 a share, said one person familiar with the talks. The offer was presented to Sun’s board on Saturday, and the board balked. The Sun board did not reject the offer outright, but wanted certain guarantees that the IBM side considered “onerous,” according to that person. Sun then said it would no longer abide by its exclusive negotiating agreement with IBM, a second person familiar with the discussions said. On Sunday, IBM’s board decided to withdraw the offer.
The breakdown in the talks, said the second person close to the negotiations, came over the shifting balance of price and conditions for the deal.
For example, IBM scrutinized the “change of control” contracts with Sun executives, senior engineers and managers. IBM felt that the payments to senior employees were higher and extended more broadly across the company than it had anticipated. IBM pointed to the change of control contracts as one reason it was reducing its offer price.
The breakup of the deal, analysts say, is a blow to Sun’s prospects. “For IBM, given its size, this was never a transformational deal,” said A M Sacconaghi, an analyst for the investment research firm Sanford C Bernstein.
“But in Sun’s case, it’s an extremely material event.” “This leaves Sun in a tough situation,” Sacconaghi added. “Sun was on a path to selling itself, and this will inevitably raise questions in customers’ minds, no matter what Sun says, about its commitment to a go-it-alone strategy.”
Sun was most concerned about securing tighter provisions to restrict IBM’s ability to walk away from the deal.
Whether the IBM decision amounts to a negotiating tactic to get agreement on the final sticking points is unclear. Though the offer is off the table for now, the two sides could resume bargaining if Sun’s share price drops from its $8.49 close on Friday and major investors pressure the company to come to an agreement. “There’s lots of testosterone going back and forth,” said a third person familiar with the discussions. All three people who discussed the deal would speak only on condition of anonymity because details of the merger talks are confidential.
Agencies
The deal’s collapse after weeks of negotiations raises questions about Sun’s next step, since the IBM offer was far above the value of the Silicon Valley company’s shares when news of the IBM offer first surfaced last month. Sun, an innovative pioneer in computer workstations, servers and Internetera software, has struggled in recent years and spent months trying to secure a suitor. With IBM and others shying away from a deal, a bruised Sun could be forced to continue pursuing a solo business model whose prospects have been questioned by many analysts.
After the legal review, IBM shaved its offer on Saturday from $9.55 a share, the proposal on the table late last week, to $9.40 a share, said one person familiar with the talks. The offer was presented to Sun’s board on Saturday, and the board balked. The Sun board did not reject the offer outright, but wanted certain guarantees that the IBM side considered “onerous,” according to that person. Sun then said it would no longer abide by its exclusive negotiating agreement with IBM, a second person familiar with the discussions said. On Sunday, IBM’s board decided to withdraw the offer.
The breakdown in the talks, said the second person close to the negotiations, came over the shifting balance of price and conditions for the deal.
For example, IBM scrutinized the “change of control” contracts with Sun executives, senior engineers and managers. IBM felt that the payments to senior employees were higher and extended more broadly across the company than it had anticipated. IBM pointed to the change of control contracts as one reason it was reducing its offer price.
The breakup of the deal, analysts say, is a blow to Sun’s prospects. “For IBM, given its size, this was never a transformational deal,” said A M Sacconaghi, an analyst for the investment research firm Sanford C Bernstein.
“But in Sun’s case, it’s an extremely material event.” “This leaves Sun in a tough situation,” Sacconaghi added. “Sun was on a path to selling itself, and this will inevitably raise questions in customers’ minds, no matter what Sun says, about its commitment to a go-it-alone strategy.”
Sun was most concerned about securing tighter provisions to restrict IBM’s ability to walk away from the deal.
Whether the IBM decision amounts to a negotiating tactic to get agreement on the final sticking points is unclear. Though the offer is off the table for now, the two sides could resume bargaining if Sun’s share price drops from its $8.49 close on Friday and major investors pressure the company to come to an agreement. “There’s lots of testosterone going back and forth,” said a third person familiar with the discussions. All three people who discussed the deal would speak only on condition of anonymity because details of the merger talks are confidential.
Agencies
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