Comments about ‘State regulators close Draper-based Advanta Bank Corp.’

i've heard their advertisments for investors for years, and wondered how they could afford to pay the stated interest rates, when savings and other account rates were so low. so now we see, they were trying to stay in business. i wonder what will happen to those who bought their notes; will they be covered by the FDIC?

Another one bites the industrial dust.

Wow, is it FDIC Friday already?

justired, those notes advertised in the papers were issued by the holding company and are not insured. The holding company is in bankruptcy so I imagine the holders of the notes will lose big time. Not secured. Why Utah allowed the issuance of the notes in the first place is beyond me. Also seems like the state banking department is becoming a regulatory joke. Their job is prevention. Letting a good bank like Barnes deteriorate and fail shows they were (are) asleep at the wheel.

As a former Advanta small business credit card customer I am glad to see Advanta suffer - not their customers of course, I wish the best for them. Advanta itself was a horrible company who exploited small businesses in the name of profit. I will sleep better tonight knowing a predator is gone fro the business world.

I used to work for Advanta..they tried...no matter what former customers may think...we tried to do a good job to help people..it is a sad day when something like this happens..i hope all the best in the world for Dennis Alter and his family..I know this must be hard for him.

"Letting a good bank like Barnes deteriorate and fail shows they were (are) asleep at the wheel."

Ken, regulators take into consideration many facts about a financial institution's solvency before they take over. In the case of Barnes Bank, certain ratios were far out of line with the regulatory standard. You may disagree with that standard, but it's a requirement all banks have to meet. Barnes, like others, may have been a "good bank" as you say. But they grew too quickly and took on too much risk at exactly the wrong time (constructions loans gone bad is an understatement).

Advanta was very good to me, I had several years of interest free loans. I love Avanta. Sorry to see them go.

Perhaps the workers and some customers were satisfied with jobs and service, but it's what happens behind the scenes with corporate CEO's and banks intangible assets. Bank's and credit unions as well have to be able to back up their lending with deposits and cash on hand. As with any business banks rely on volume in borrowing and repayments. When lending exceeds repayments this is what happens, they go insolvent. Instead of deposits becoming an asset, it gets diverted to cover overhead (salaries, utility's, payroll, etc.).

Just as a business over extends itself with debt and cannot repay, a bank must be able to absorb this loss with tangible assets. When business has to borrow money to pay its employee's its a danger sign to failure.

This is why our government is in a position of bankruptcy with its multi-trillion dollar debt of borrowed money.

The American economy has been on float (cashless) for over 20 years and the piggy bank has run dry. Why consumer and business debt is considered a strong economy is beyond my ability to comprehend. Every country that uses this concept is in failure and inflation rampant.

The average size of an FDIC insured institution is 110 million dollars. Thus, Advanta was the equivalent of over 15 banks failing. The FDIC was out of money last year, and insolvent. It should have been put into recievership. With the rate of bank failures exceeding that of last year, they will be there again, especially when Zions bank is taken over.

If you add up all of the deposits in all FDIC insured financial institutions in the country, one-half of the deposits are in institutions on the FDIC waiting-to-fail list.

Credit unions are better, but if I were you I would pull your money out of financial institutions if you ever want to see it in the future. Although still falling, I would suggest real estate or other tangible asset that has the potential of making you some money.

It will be interesting to watch and see whether it is our failing bank/FDIC system, or the collapse of the Euro that triggers an economic crisis much bigger than our last one.

All is not well in Zion.....

that socialist FDR program. Those people should have lost every cent. Signed your right wing Neo-cons.

Don't listen to AVERAGE above, really bad advice. Zions is strong, credit unions are being close 3 to 1 over banks but you do not hear it. Taking your money out will CAUSE more failures.