By Simon Kennedy
LONDON (MarketWatch) -- Subprime lender Superior Bank FSB funded more than 6,700 subprime loans worth over $550 million while being run by the Federal Deposit Insurance Corp., according to a report in The Wall Street Journal on Monday.
Rather than immediately closing or selling Superior, as it normally does, the FDIC continued to run the bank's subprime mortgage business for months after taking it over in 2001 as it looked for a buyer, the report said.
Loans made on the FDIC's watch have suffered the same problems for which regulators have criticized the industry, including lending to unqualified borrowers, inflated appraisals and poor verification of borrowers' income, the newspaper said, citing government documents filed in federal court.
Source:
http://www.marketwatch.com |
