Venture’s demise comes as no surprise

September 15th, 2009 by Ken

The demise of Venture Bank should have come as no surprise to anyone who has kept up with events over the past year.

It’s like an old pet which you know is on it’s last legs, but when the end comes, you’re still a little shocked and a little saddened.

For more than a year the media has let it be known that Venture Bank had suffered big losses when Fannie Mae and Freddy Mac almost went under.  The bank had invested large sums of money in these quasi-governmental agencies, not unlike many other banks around the country.

They had been assured that their investment was sound and managers of Venture Bank were as shocked as anyone when these East Coast institutions almost went under, saved only by a major influx of taxpayer money.  But in the process Venture Bank lost all of its invested money.

Venture Bank had also invested large sums of money in the construction industry which had been running full out for several years.  Investments, which at the time seem reasonable and prudient, but which ended up with the bank holding many loans which were uncollectable.

The bank also invested money in several restaurant ventures which also failed when the economy went south and with it any chance that those restaurant loans would be repayed.

Venture Bank and its management had always been interested in investments which made a great deal of money even if those investments might have a degree of risk.   And for nearly 30 years Venture Bank paid quarterly dividends, often with great returns.

Anyone who bought Venture Bank stock back when it was Lacey Bank, has made back many times their original investment.

But those currently left holding stock in the bank now have stock that is worthless.

The FDIC, the Feds, took over the bank last Friday and forced a sale of the bank.  All of its assets and liabilities now go to First Citizens Bank out of Raleigh, North Carolina.  All of Venture Bank signs have been changed, but you’ll see the same people behind the counters.

Most of the employees will be kept on and even some of the management team, but it won’t be the same.   First Citizens Bank may be a very fine bank, it may even be a great bank, but it’s not a local bank with local ownership.

Venture Bank was always involved in the community.  It’s management people were members of several local organizations and its money helped many social service and other non-profit organizations.

Those in the know tell me that First Citizens Bank will also be involved in the community and will continue many of the community-oriented activities of Venture Bank.

But like all losses it takes time to mourn.  I need that time to mourn before I embrace the new.

Posted in Business, History, Informational, The Real News

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