More bullshit on Patriot Bank

Greenwich Time logs in with a hard-hitting piece of Patriot’s sale to a new investor. Here are the white-washed bits:

The new holding company also indicated it intends to bring in experts to help run the bank, although it did not say whether Carrazza would replace the current management. [Would you keep the jerks who blew hundreds of millions of dollars loaning good money to bad people and bad property? Neither will Carrazza – Ed.]

PNBK Holdings and the bank originally signed a letter of intent for the control change in July, but Patriot National’s board told Carrazza in October it was considering a rival bid worth more money [fat chance – Ed.]

which prompted Carrazza to sue in New York and Connecticut.The lawsuit in New York has been or very soon shall be withdrawn and the one in Connecticut is being settled with an agreement between the parties.

In previous reports, bank executives said Patriot National sought an infusion of capital because of concerns over a portfolio filled with Greenwich construction loans that had to be carried on the books longer than anticipated because contractors were not able to sell their projects after completion. Because of the loans, the bank grew concerned it was coming too close to its regulatory capital minimums. But Patriot National remains adequately capitalized, officials said.

I don’t know – I assume that Greenwich Time’s lawyers are worried about law suits, but since I’m pretty much judgement-proof, here’s my read on the situation: Patriot’s been operating under a consent agreement with the FDIC for over a year, so “concerned that it was coming to close to its regulatory capital requirements” really means, “told by regulators that they had violated their capital requirements and needed new money or they’d be shut down”. What’s so hard about reporting a fact?

“Greenwich construction loans that had to be carried on the books longer than anticipated” really means that the bank made loans to, say, Dom DeVito (currently doing 52 months in Otisville), paying him $6 million in advance for a dream house at 516 R0und Hill Road.The loan is there, the house is not. I like Dom, but I wouldn’t loan $6 million to a 2X felon on his promise to build something nice. Patriot did.  Baldwin Farms South, not a Dom project but just as crazy, was also fully-funded by Patriot and just as worthless. Etc. If Patriot, a local bank, ever heard of the “know your customer rule”, it paid no attention. Nothing in its Greenwich portfolio will ever approach what the money it sunk into it. Total loss. And that’s the real business report this morning.


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6 responses to “More bullshit on Patriot Bank

  1. Lawyer wannabe

    Are you judgement proof because:

    a) you have no assets to lose..therefore nothing at risk?

    b) you rely on “free-speech” or “speaking truth” doctrine for your defense?

    c) nobody is listening?

    d) all of the above?

    e) other?

    Threats of “business slander” is what keeps me anonymous. Why not you?

  2. Pierre Bergé, Nom de Plume

    Patriot va être l’ouverture d’une branch à Cos Cob?

  3. trader

    I thought this was an excellent detailed post that pointed out the real issues on this deal that the Greenwich Time writer just didn’t understand or didn’t bother to research. Will someone please help the GT hire a real finance reporter or they continue to insult the reader with soft reporting.

    Partiot has been opperating under an MOU for some time now and the FDIC likely let them go on longer then normal becuase they couldn’t get anyone else to off load the troubled bank on.

  4. Pingback: Inside secrets to get a construction loan to build your own house. | Construction Best

  5. Concerned citizen

    Do you have any more information and insight on how Marty Noble, from PNB was publicalty trying to lower the PNB stock price and shareholder’s expectations in order to attract some buyer, preserving Marty’s PNB stock and position? Here is what I thought happened:

    Marty Noble new early on, fall of 2008, that the bank was in deep trouble and needed to find someone to buy it before it was taken over by the FDIC or went bankrupt, both scenarios not appealing to Marty’s position at the bank. I think to lower the shareholders expectations, Marty enlisted the help of press to publicly lower the value of the bank and therefore allow a takeover. Marty new this and had the “poison pill” provision removed allowing for a hostile takeover in lieu of bankruptcy or being taken over by the FDIC.

    In doing all of that, between the article in NY Post, and other misinformation passed on from Marty to the press regarding Greenwich properties, caused properties not to be sold due to bad press that he was pushing so his bank looked more attracted for a takeover. The takeover would give him more of a chance to keep some stock and compensation instead of losing everything in bankruptcy or FDIC taking over.

    The founder of the bank was Fred De Caro, who’s son, Angelo, still is at the bank. Fred was kicked out by the FDIC years back and then opened USA bank in Port Chester NY and was was also kicked out of USA Bank by the FDIC. I think, if we look carefully enough that we will see a link between Fred, Angelo, Marty and Michael Carazza in this transaction, where everyone worked together to lower the value of the bank where $50m was enough to take control of the $1bn in assets. I think you will see that Carazza will start selling the foreclosed properties to “friends”

    This entire process of bank officers protecting their jobs and stock but defaming the bank, lowering the share price, lowering the perceived value of their loan portfolio, in order to attract a suitor at the right price, has adversely impacted the value of Greenwich properties and the ability to sell them.

    Let me know your thoughts