7 more savings banks suspended
I thought the FDIC, SEC, government high heels would take care of me… ok, so this is what happens when you place your trust in the government. 2 savings banks are being prosecuted in Korea for going belly up due to bad construction loans. The wrinkle is that these loans were made with pressure from some corrupt officials at the Financial Services Commission, the SEC of Korea (but they have jurisdiction over everything financial).
Now other savings banks, which are insured in a similar fashion as the soon-to-be bankrupt FDIC in the US, are going belly up. So what happens to depositors? Well, they’re waiting… to get access to their own money. Bigger banks are going to have to bail these banks out, if they can’t the Bank of Korea may step in. Either way it will take a while and if there are more… well, then we have a bank run on the entire banking system of Korea.
People! Take responsibility for yourselves. The government can’t do shit when it really matters.