Webster Bank Weighs Application For Federal Funds

If Webster qualifies for this assistance, dont be fooled. They got in over their head on subprime loans which translates to liquidity problems. Good luck drawing on your LOC or making an acquisition. At a minimum clients should expect there availability ratios tightening up significantly if they havent already.

Maybe they are getting shakey, keep an eye on them.

Whats the matter Webster and all other banks? Are you afraid that if you take the Government loans you wont be able to charge $32 for overdraft fees on the poor anymore? That used to be called "usery" you know? Now its called "fees". What exactly did some bank employee have to do when one was overdrawn by $1 to warrent a $32 charge? Can you say "REGULATIONS'?

When the government’s plan to rescue the frozen credit markets was explained to the American voters, it was just that a rescue plan. The system was very complicated and some obscure financial instrument called a Credit Default Swap was to blame. The problem was very sophisticated but it was based on some very fundamental home mortgage and real estate issues. Congress passed the legislation in record time due to the urgency.

The Courant article on Webster Bank’s quarterly report puts a wet blanket on the urgency of the bailout. Webster’s management is looking at ways to use the government money to acquire other banks and expand their footprint in the region. This does not sound like an urgent matter to me, this sounds like a bank acquisition plan funded by the US tax payer. In the bankers defense, they indicated that the government plan is supporting this type of activity.

Somewhere between Chris Dodd and Hank Paulison’s explanation of the problem and the Webster Bank’s quarterly report, the American people were left out. Left out of the understanding but still having to pay the tab.