EMIGRANT BANK and the ugly face of crony capitalism.

Howard Milstein owns and runs a bank that is merciless with those unfortunate to have them as a lender.  Here are some of the stories. The bank has a little clause in its mortgages that raises the rate to 18% if you fall 90 days late. Get into trouble and Emigrant Bank knee-caps you. Ok, there are some tough banks and mean lenders but there must be more to the story.


There is. Emigrant Bank is the largest private bank in the country. They are owned by a family of real estate speculators who “donate” to every politician in New York and Washington. After the meltdown, Emigrant  got into trouble themselves and pled for help from the federal government. Did the feds double their interest rates? No, they reduced them and then loaned Emigrant almost $300 million in TARP money. You have to take care of a friend. Here is background info on Emigrant Bank


Surely that was enough and Emigrant paid back the TARP money? No, and at the same time Old Howie was out there doing off shore deals and soliciting investments.


I have it from good sources that Howard met with some rather oily developers trying to do a Jack Nicklaus golf course deal in Costa Rica. They met at The Breakers in Palm Beach and Howard was all ears taking the pitch. Emigrant  never did the deal but he was not exactly trying to modify mortgages. You never would have known that his bank was teetering, but it was and the story does not end.


Politically connected Howard Milstein has got the NY pols to cut a special deal for him in the Dodd-Frank Bill:

Deal Journal

An up-to-the-minute take on deals and deal makers.

• New York’s Emigrant 

Savings Pushes Dodd-Frank Tweak

By Alan Zibel

Can a well connected New York bank convince lawmakers on Capitol Hill to make a tweak to the Dodd-Frank financial overhaul law?

Bloomberg

Howard Milstein in 2008

Emigrant Savings Bank, a privately held bank run by Howard Milstein, a prominent real estate investor and backer of New York Gov. Andrew Cuomo, is trying to do so.

The bank is seeking a four word-change to the 2010 law, arguing that it will soon be unfairly ensnared by regulations intended for bigger institutions.

Without the tweak, the bank says it will be forced to count fewer assets as loss-absorbing capital. With a smaller buffer, bank officials say they will be less able to make loans.

The House Financial Services Committee is scheduled to consider the measure on Thursday. It has the support of a bipartisan group of six House members from New York and no public opposition thus far.

However, lawmakers in the Senate have shown little interest in making even minor tweaks to the sweeping overhaul of regulations for the financial system, so Emigrant could face long odds there.

Emigrant is pressing for Congress to allow the bank to fall under a key $15 billion threshold for assets. Banks with assets below that level are allowed to count a form of debt known as “trust preferred” securities as part of their capital buffer against losses.

At a hearing last week, Emigrant’s chief regulatory officer, Richard Wald, noted that Emigrant currently has $10.5 billion in assets and has been under the $15 billion threshold “for most of its history.”

The problem, Mr. Wald told lawmakers, was that Emigrant was briefly over the $15 billion limit at the end of 2009 due to $2.3 billion in temporary borrowing intended to help the bank withstand the financial crisis.

The bill would make a simple, but significant, change to Dodd-Frank. It would add another date — March 31, 2010 — for calculating the $15 billion threshold. At that time Emigrant had $13 billion in assets, well under the $15 billion level.