Friday, February 19, 2010

If Tiger Can Do It, Alexi Can Too

Where's the mea culpa, Alexi? From the Illinois GOP:

If Tiger Can Do It, Alexi Can Too

"If I'm fortunate enough to make it out of the primary, we can have that conversation," he said. His plan now seems to be to stonewall until November.

– Chicago Tribune Editorial, February 12, 2010

CHICAGO – As Alexi Giannoulias enters his 22nd day of silence since promising reporters he would answer questions surrounding his role in the near-collapse of his family’s Broadway Bank, the Illinois Republican Party today renewed its call for Giannoulias to answer the Chicago Tribune’s demand to come clean.

Despite an FDIC consent decree ordering Broadway Bank to recapitalize $19 million by February 3rd, Illinois voters still do not know whether the Giannoulias family has complied.

Furthermore, while Senator Dick Durbin said Giannoulias should be more forthcoming regarding his pursuit of high-risk loans and investments during his time as Chief Loan Officer for Broadway Bank, Giannoulias has not appeared before reporters in the Chicagoland area since February 3rd – the same day as the FDIC deadline.

Just in case any reporters are lucky enough to catch a glimpse of Alexi Giannoulias this weekend, here are a few questions you might ask him:

1) Under the FDIC Consent Decree, your family was required to put $19 million back into Broadway Bank by February 3rd. Was that deadline and met and did you personally contribute to the first replenishment?

2) If the FDIC does takeover Broadway, will you pledge to return all dividends you received to help cover the costs the government would incur in covering Broadway’s deposits?

3) Your and your family took $70 million in dividends in 2007 and 2008.[1] That money would have gone a long way toward properly capitalizing Broadway. In hindsight, were those payments wise?

4) During the time you were the chief loan officer at Broadway Bank, risky construction and development loans went from 25% of the bank’s loan portfolio in 2002 to 46% in 2006.[2] More than 50% of Broadway’s bad loans, $138.5 million as of December 31, 2009, were construction and development loans[3] and the FDIC has ordered Broadway Bank to cease investing so heavily in them.[4] In hindsight, was it prudent to put so many of Broadway Bank’s eggs in the construction and development basket? And if it was not, don’t you share some of the responsibility for Broadway’s current troubles?

5) When running for Treasurer your “financial expertise” as a community banker was your central argument for why the voters should choose you.[5] While at Broadway Bank, did your “financial expertise” lead to you express any concerns about the bank’s growing reliance on brokered deposits, which stood at 80% of all deposits when you left the bank?[6]

6) Broadway Bank grew rapidly while you worked there. Your campaign website while running for Treasurer stated “As vice-president and senior loan officer at Broadway Bank, Alexi played a vital role on the bank’s management team that doubled its asset size to more than $750 million.”[7] In hindsight, was playing a “vital role” in growth fueled largely by risky loans and expensive brokered deposits something to be proud of?

7) You defended loans you made to Michael “Jaws” Giorango -- a convicted mobster, bookie and pimp -- by claiming that the loans themselves were financially sound. Those loans are now in foreclosure.[8] Do you still think those loans were sound?

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[1] http://www.chicagobusiness.com/cgi-bin/article.pl?article_id=32332&seenIt=1

[2] http://www.chicagoreader.com/chicago/can-alexi-giannoulias-family-bank-obamas-senate-seat/Content?oid=1245291

[3] Broadway Bank 12/31/2009 Call/TFR financial report, FDIC

[4] Broadway Bank Consent Decree, page 12

[5] Financial, legislative experience at odds in state treasurer race, Chicago Defender, November 3, 2006

[6] Broadway Bank 12/31/2006 Call/TFR financial report, FDIC

[7] Giannoulias 2006 campaign website, archived at: http://web.archive.org/web/20060820191858/www.alexiforillinois.com/meet_alexi.html

[8] http://www.chicagobusiness.com/cgi-bin/article.pl?articleId=32169

[9] http://thecapitolfaxblog.com/2007/12/04/this-just-in-90/

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