(Includes information about published reports of federal raids at Colonial Bankshares locations.)
JUPITER, Fla. ( TheStreet) --One of the costliest bank failures over the past two years looms and another large institution sits on the brink after two holding companies made dire announcements following Friday's market close.
Corus Bankshares (CORS) on Friday filed a preliminary earnings report announcing that main subsidiary Corus Bank NA was technically insolvent, with core capital of negative $157 million.
Federal agents from several agencies on Monday raided the Orlando, Fla., offices of Colonial BancGroup (CNB), according to published reports. The raid comes just three days after company on Friday expressed "substantial doubt" about its ability to "continue as a going concern" in its second-quarter earnings release.Both holding companies have been exploring strategic opportunities to be acquired, raise capital or sell substantial assets, to no avail. In the current environment, potential acquirers, including bank holding companies and private equity investors, are insisting on government assistance as part of any deal to acquire substantial amounts of distressed loans. The Federal Deposit Insurance Corp. is only willing to share in losses on failed institutions.