Summary
First Hanover Bank - Includes related article on portfolio - Cover Story
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How to break the bank.
With loose lending, which put First Hanover in a tight squeeze. To ease pressure, regulators pulled the plug.
State Commissioner of Banks Bill Graham vividly remembers the moments just before First Hanover Bank officially failed. At 10 minutes to 6 on Friday, Oct. 25 of last year, he was standing near a window in the bank's headquarters on 17th Street in Wilmington with Jim Ross, the bank's president of two months. Through the vertical blinds, Graham could see a phalanx of Federal Deposit Insurance Corp. personnel, 30 or 40 strong, computers tucked under their arms, descending on the bank and its branch just across the parking lot. A truck had pulled up, and a giant copying machine was being unloaded to meet the FDIC's prodigious needs. Armed deputy sheriffs were taking up positions near the bank entrances. And, apparently unaware of these flaming signals that something was very wrong with their bank, customers were still racing to deposit their money. "Honest to goodness, I saw some guy pull up in a pickup truck at 3 minutes to 6 and run into the bank because he wanted to get his deposit in before 6 o'clock," Graham recalls. "And I'm waiting there with Ross at my side getting ready to give me the keys." Bank failure, North Carolina style. But First Hanover's customers can't be blamed if they didn't recognize the signs of imminent bank seizure. After all, the last bank to fail in the state was the Bank of Black Mountain, in 1943. And, as it turned out...See the full content of this document
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