Facebook
Fark
Digg
Reddit
StumbleCommunity Bancorp files for bankruptcy protection
Saturday, May 29, 2010 | 2:05 a.m.
Sun Archives
Nine months after its Nevada and Arizona banks were closed by regulators, Community Bancorp filed for bankruptcy protection Friday.
The filing showed federal regulators are demanding some $805 million from the company because of alleged mismanagement of the banks.
In the Las Vegas bankruptcy court filing, Community Bancorp listed debt and liabilities of more than $880 million including demands of $805.5 million by the Federal Deposit Insurance Corp.
The Las Vegas company listed $43.7 million in assets and indicated unsecured creditors will recover nothing in the Chapter 7 liquidation.
The company’s main assets are $27.1 million in federal income tax refunds due because of net losses between 2004 and 2007; and $16.5 million for directors and officers insurance policies.
The main creditor is the FDIC, which has asserted a $780 million claim against subsidiary Community Bank of Nevada for civil damages and wrongful acts apparently tied to concerns that the bank failed because of unsound lending practices.
The FDIC made a similar demand, for $25.5 million, against subsidiary Community Bank of Arizona.
Both of the FDIC claims are listed as “disputed” by Community Bancorp.
Other big creditors are Merrill Lynch, as trustee for investors in trust securities owed $20 million; Wilmington Trust Co., another trustee for investors owed $50 million; and Pacific Coast Bankers Bank, owed $5.2 million.
On Aug. 14, regulators closed Community Bank of Nevada as well as Community
Bank of Arizona.
Community Bancorp had been hurt by the recession and its reliance on real estate loans — many financed with high-rate brokered deposits.
The FDIC said that as of June 30, 2009, Community Bank of Nevada had loans and other assets of $1.52 billion and deposits of about $1.38 billion.
Discussion: comments so far…
Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.
Only trusted comments are displayed on this page. Untrusted comments have expired from this story.
No trusted comments have been posted.
Post a comment
Most Popular
- Viewed
- Discussed
- E-mailed
- Photos: Olivia Culpo, 20, of Rhode Island is crowned 2012 Miss USA at Planet Hollywood
- US Navy hopes stealth ship answers a rising China
- Learning about Electric Daisy Carnival fans will help Las Vegas court them
- On the horizon: A quick look at projects poised to shape downtown
- Clark PG Kentrell Washington heading to Hofstra basketball
Everything Under the Sun
Blogs
The Kats Report
Joe Pesci remembers his own honeymoon in Vegas -- meeting the Rat Pack
Las Vegas Philharmonic says search for new music director to begin 'immediately' (1 Comment)
With Shenandoah project stalled, Wayne Newton hits back legally (7 Comments)
Where does a Playmate play when she turns 21? Vegas! (3 Comments)
Ice Ice Billy
The road to six-toed cats and Mayor Bubba
The Kats Report
David Itkin tells L.V. Philharmonic officials he's on his way out (14 Comments)
Diamond Dave sells it well as Van Halen pours out the power at MGM Grand (2 Comments)
- Locally owned and independent since 1950; Winner of the Pulitzer Prize for Public Service, best news website in the nation & DuPont Award for broadcast journalism
alot of these thatnk goes are mismanage
And all these directors, v.p.'s, managers, etc. Just move on to another job like nothing happened...
Disgusting..just disgusting that lending practices were thrown in the garbage.
No job, no income, no assets, bad credit...here's a 350k mortgage for you sir.
Disgusting
that sucks. it's too bad that small banks like this fail while the giant scumbags like chase, B of A, and wells fargo contine to treat everyone like crap.
Fault of Bush's "ownership society" mismanagement of the Clinton surplus.
What amazes me about ALL these banks is: It's there business - MONEY..they are supposed to be the best at what they do and here we are not only bailing them out, but also closing them because they don't know how to run a business..ggeezz..give it back to the small business man and let them get this country back on track...bankers know money (or are supposed to) and they can't runa bank...oh well...
retiredyoungster...
they are the best at what they do. senior management draws millions in salaries as fast as they can, then leave the mess for someonelse to clean up. once you pay a man 10 million in salary you have retired him for life. not much incentive for him to care about others after that. and many get much more than 10 million. it's like winning the lottery. no risk to the individual because the corporation is it's own entity.
management recociles their risky behavoir by telling themselves that the government will bail out some of the investors. it's been downhill since we started bailing out private corporations since Lockhead in the late 1970s.
the horror with the current bank bailout is that individuals got richer through bonuses. there is really no more shame in what big government and big business will do. they have lost all ability to be good stewarts.
i'm not sure about you, but i am not very proud of our system right now. trust me, we are building a have and have not society. and there will be more have nots.
i'm not sure about you, but i am not very proud of our system right now. trust me, we are building a have and have not society. and there will be more have nots.
And soon, very soon the have nots will revolt. You will see more crime and people walking away from their obligations. Corporations will turn their backs on their own employees to allot more bonus money for the select few. Wait a minute! It's already here. Look out for number 1, noone else will.
I appreciate the above comments but would like to add that this is an unprecedented economy. The bankers' guidelines and lending practices don't work in an economic environment of mass implosion. Who of you forecasted the precipitous drop in commercial real estate and the decline in home values that we experienced? Not even the brightest and best economists did, let alone Southern Nevada bankers. Before you cast stones at the bankers for not doing their jobs or for being greedy, remember it is because not one or two customers stopped paying, hundreds did. Once the economy redlined, there was no way to turn it, or the banking environment around. Banks fail because clients stopped honoring their obligations and took the easy way out through bankruptcy. It is they who should be the subject of your disgust.
bulldog hit the nail on the head. What he is said is very true for many failed banks in Southern Nevada. Community may be the exception as well as Silver State. It was well known that they were doing not so stable lending. Many of the other Southern Nevada Community Banks just have too many people giving the properties back and unfortunately there is no one out there to buy these properties at a reasonable price.
No one could have predicted the failure we have at hand. The best thing peole can do is just make sure they money is insured and make your payments.