When does common sense prevail? Not when Guaranty Bank of Austin ponders what to do about some homes in Victorville, CA they can’t sell. They recently decided to demolish brand new homes instead of finding a common sense way to dispose of these holdings. The logic was it would have cost them approximately $1,000,000 to complete the project versus $100,000 to tear down those homes which were recently completed. Okay….did they offer them to anyone for $1.00, or $10,000, or the cost of finishing those which were partially completed? It doesn’t appear that way. From what I can tell 4 of the 16 homes in this subdivision were completed. One reader commentary suggested that basic infrastructure like sewer; water and electric weren’t brought into the site yet. I don’t buy it. These are usually the first things to be brought into a site before the building begins. You mean to tell me the model home didn’t have electricity?
Guaranty Bank of Austin had the chance to do something good. Give a well deserving family in the Victorville area a brand new home at an incredible deal. Instead they did a bottom line analyses with no human heart thought of greater possibilities. For this they earn my first Stupid Ass Award. I know there are many others who were dumbfounded by Guaranty’s action in Victorville so let me make a suggestion on how to send a message to the bank they might understand. If you are currently a bank customer of Guaranty Bank of Austin and equally disgusted by their decision to demolish these homes consider taking your money out of their bank and put it with one that has common sense. Be sure to let them know why you are closing and transferring your account. Perhaps if they realize customers are willing to withdraw millions of dollars in deposits because of their bonehead decision they’ll realize it did cost them more than just $100,000. This is probably a moot suggestion however because The Office of Thrift Supervision (OTS) recently ordered Guaranty Bank to meet a core capital ratio of at least 8 percent and a risk-based capital ratio of at least 11 percent and Guaranty said in a regulatory filing that "management believes, based upon presently available unaudited financial information, that the bank does not meet the required capital ratios set forth above." So… if the bank does not meet the required capital levels by May 21, Guaranty said, it would adopt plans to merge with or be acquired by another financial institution, or face liquidation. Rocks of Ruck.
If you haven’t seen the video on this act of stupidity then click here: http://www.youtube.com/watch?v=4Ilayp2ykts