Have You Become Bank Yet?

Jan 15, 2009 9:52am

ABC News’ Charles Herman reports:  As Congress mulls over whether or not it will try to stop the remaining half of the $700 billion Troubled Asset Relief Program from being provided to the incoming administration, that hasn’t stopped non-bank businesses from turning themselves into banks hoping, perhaps, to get some of that money.

Birmingham-based Protective Life Corporation received approval Thursday from the Federal Reserve to become a bank holding company by acquiring Bonifay Holding Company in

Bonifay

,

FL.

According to

Hoover

’s, Protective Life focuses offers life insurance policies as well as annuities.  The business tracking service also reports that the company “invested a significant portion of its assets into mortgage-backed securities, preferring to invest in pools of prime residential mortgages and non-speculative commercial properties such as strip-center retailers.”

As a bank holding company, Protective could apply for funds through the TARP program.

Earlier this week, insurance companies Hartford Financial Services and Lincoln National received permission from the Office of Thrift Supervision to purchase savings-and-loan institutions that would allow them to become thrift holding companies.  That in turn could make the eligible for the funds through the financial rescue plan approved in September. 

Hartford

is looking to purchase Federal Trust Bank of

Sanford

,

Florida

, for $10 billion.  Lincoln National wants to acquire Newton County Loan & Savings in

Goodland

,

Indiana

.

These moves come after businesses such American Express, CIT and GMAC Financial all morphed into bank holding companies and then received money through what has become the troubled, Troubled Asset Relief Program.

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