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#922003 - 03/13/08 04:28 PM One depositor equaling total banks deposit.
Anonymous
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Is there any issue with a depositor who own no interest in the bank to equal or surpass the total deposits currently held in the bank? S/O only applies if the indvidual holds a large share of the bank correct?

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#922022 - 03/13/08 04:42 PM Re: One depositor equaling total banks deposit. Anonymous
califgirl Offline
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The O.C., California
From a compliance standpoint, probably no issues.

However, there are a magnitude of other issues, starting with liquidity, asset/liability management, profitability, concentration of deposits, and on and on. Why would the bank want this kind of relationship?
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#922033 - 03/13/08 04:51 PM Re: One depositor equaling total banks deposit. califgirl
Anonymous
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So a a follow up, would anyone here refuse to get 6 billion in deposits? He is moving his assets from B of A.

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#922059 - 03/13/08 05:04 PM Re: One depositor equaling total banks deposit. Anonymous
Anonymous
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Ah, if only we had such problems to worry about. Sorry I can't be any help in assessing your situation.

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#922376 - 03/13/08 07:38 PM Re: One depositor equaling total banks deposit. Anonymous
RBanker Offline
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$6B with a B? I'm sorry, but personally I would be a little cynical about this...there are very few individuals with that kind of liquid assets...
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#922401 - 03/13/08 07:51 PM Re: One depositor equaling total banks deposit. RBanker
Anonymous
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this is not a personal account it is a compnay with 10 Billion in assets and I am dealing with the Chairman

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#922436 - 03/13/08 08:13 PM Re: One depositor equaling total banks deposit. Anonymous
Richard Insley Offline
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Toano, VA
Does this wealthy gentleman happen to be Nigerian?
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#922470 - 03/13/08 08:34 PM Re: One depositor equaling total banks deposit. Richard Insley
John Burnett Offline
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John Burnett
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Cape Cod
With this kind of number being kicked around, you can understand the cynical comments. It does seem more than strange.
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#922511 - 03/13/08 09:13 PM Re: One depositor equaling total banks deposit. John Burnett
Anonymous
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nope not Nigerian and local to my area but yes I can understand the cynicism. I just got 45 million today by wire

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#922523 - 03/13/08 09:19 PM Re: One depositor equaling total banks deposit. Anonymous
califgirl Offline
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The O.C., California
I always wonder about a customer who would place large (uninsured) deposits in any bank other than a B of A-size instituion.

What does this customer want?
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#922685 - 03/14/08 11:42 AM Re: One depositor equaling total banks deposit. califgirl
Rocky P Online
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Florida
FWIW - I would make sure that the bank could handle it - there will be a strain on ALCO - what to do with the money, and the board is in full agreement.

If you invest it (even for a short time) and the customer takes the money out, the bank wouldn't have enough open lines to draw that type of liquidity.

Assuming they're OK from the ALCO standepoint (and do a balance sheet stress test), and ASSUMING that your CAPITAL would still be within regulatory guidelines, I would recommend the COB or CEO contact your regulator and seek their guidance. Imagine their shock of the bank doubling in size in one quarter. You would have a team of examiners and liquidity specialists at your door the day after the call report was filed.
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#922982 - 03/14/08 03:38 PM Re: One depositor equaling total banks deposit. Rocky P
Anonymous
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thanks for all the great advice, it is truly apreciated

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#923285 - 03/14/08 06:37 PM Re: One depositor equaling total banks deposit. Anonymous
Don_Narup Offline

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Joined: Jul 2001
Posts: 3,708
Las Vegas Nevada
The bank can be in serious financial trouble if it makes a lot of loans against these deposits and the customer then pulls out a lot of his deposits.

Never be so dependent on one depositor. He's going to own you.I would think examiners will take a hard look and find a problem with this. I would recommend you ask them about this now.

Be very careful here. Watch your wire transfers
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#923447 - 03/14/08 08:15 PM Re: One depositor equaling total banks deposit. Don_Narup
texasbanker123 Offline
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Joined: Jan 2008
Posts: 27
this is cool

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#923574 - 03/14/08 09:32 PM Re: One depositor equaling total banks deposit. Anonymous
CalifDreamin Offline
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CalifDreamin
Joined: Mar 2002
Posts: 2,202
Far from Calif
I would think, too, that you'd want to have your BSA Officer involved, and don't take any shortcuts at all on CIP, due diligence, etc. which you might be tempted to do with the large $ figure. It's always the "big" ones that officers try to take short cuts on, but with this one, the bank has a lot to lose if something goes wrong.
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#923733 - 03/16/08 03:45 AM Re: One depositor equaling total banks deposit. Rocky P
Jokerman Offline
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Originally Posted By: Southern Banker
Assuming they're OK from the ALCO standepoint (and do a balance sheet stress test), and ASSUMING that your CAPITAL would still be within regulatory guidelines...


This is going to be like trying to drive fast as save gas at the same time. Unless the bank has an existing capital ratio that is more than double the guidelines, the only way you would be able to try to handle it would be to maintain it in something with preferential risk-weighted treatment (think mortgage-backed securities), and even that won't help with the leverage ratio. But the problem is, you're (almost assuredly) not going to get the depositor to agree to structure the maturity of his $10B to match that of your investments, so you'll never be able to manage the IRR and capital ratio at the same time, at least not that I can see.

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