by Calculated Risk on 10/06/2022 04:25:00 PM

A few brief excerpts from a note by Goldman Sachs economist Spencer Hill:

We estimate nonfarm payrolls rose by 200k in September (mom sa), 50k below consensus and a slowdown from the +315k pace in August. ... We estimate the unemployment rate was unchanged at 3.7% in September ...
emphasis added

CR Note: The consensus is for 250 thousand jobs added, and for the unemployment rate to be unchanged at 3.7%.

by Calculated Risk on 10/06/2022 02:16:00 PM

On Friday at 8:30 AM ET, the BLS will release the employment report for September. The consensus is for 250,000 jobs added, and for the unemployment rate to be unchanged at 3.7%.

There were 315,000 jobs added in August, and the unemployment rate was at 3.7%.

Click on graph for larger image.

• First, as of August there are 240 thousand more jobs than in February 2020 (the month before the pandemic).

This graph shows the job losses from the start of the employment recession, in percentage terms.  As of August 2022, all of the jobs have returned.

This doesn't include the preliminary benchmark revision that showed there were 462 thousand more jobs than originally reported in March 2022.

• ADP Report: The ADP employment report showed 208,000 private sector jobs were added in September.  This is the second release of ADP's new methodology, and this suggests job gains inline with consensus expectations.

• ISM Surveys: Note that the ISM services are diffusion indexes based on the number of firms hiring (not the number of hires).  The ISM® manufacturing employment index decreased in September to 48.7%, down from 54.2% last month.   This would suggest 25,000 jobs lost in manufacturing.

The ISM® services employment index increased in September to 53.0%, down from 50.2% last month.   This would suggest service employment increased 155,000 in September.

Combined, the ISM surveys suggest 130,000 jobs added in September (below the consensus forecast).

• Unemployment Claims: The weekly claims report showed a decrease in the number of initial unemployment claims during the reference week (includes the 12th of the month) from 245,000 in August to 209,000 in September. This would usually suggest fewer layoffs in September than in August. In general, weekly claims were lower than expectations in September.

•  COVID: As far as the pandemic, the number of daily cases during the reference week in September was around 70,000, down from 115,000 in August.  

• IMPORTANT: Usually in September, about 1.2 million educators are hired as the school year starts in some areas. This is seasonally adjusted to around 0 (since it is expected). It is unclear if that many will be hired this year - with the overall tight labor market - and this could distort the headline number.

• Conclusion: The consensus is for job growth to slow to 250,000 jobs added in September.  The ADP report was in line with expectations, and weekly claims were positive.  However, it seems likely that education will disappoint seasonally adjusted, so I expect the headline jobs number to be at or below the consensus forecast.

by Calculated Risk on 10/06/2022 01:50:00 PM

From CoStar: STR: Jewish Holiday Shift Leads to Expected US Weekly Hotel Performance Decline

As expected with the Rosh Hashanah holiday, U.S. hotel performance dropped from the previous week and showed mixed comparisons with 2019, according to STR‘s latest data through Oct. 1.

Sept. 25 through Oct. 1, 2022 (percentage change from comparable week in 2019*):

• Occupancy: 66.4% (-2.4%)
• Average daily rate (ADR): $149.71 (+15.7%)
• Revenue per available room (RevPAR): $99.36 (+12.9%)

In addition to the Rosh Hashanah impact on business travel and groups in the major markets, there were demand shifts in the southeast region due to Hurricane Ian. ...

*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019.
emphasis added

The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

Click on graph for larger image.

The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021.  Dashed purple is 2019 (STR is comparing to a strong year for hotels).

The 4-week average of the occupancy rate is close to the median rate for the previous 20 years (Blue).

Note: Y-axis doesn't start at zero to better show the seasonal change.

The 4-week average of the occupancy rate will increase over the next few weeks during the Fall business travel period, and then decline into the Winter.

by Calculated Risk on 10/06/2022 10:34:00 AM

Today, in the Calculated Risk Real Estate Newsletter: "For many [home] sellers, it likely feels like the rug has been pulled out from underneath them"

A brief excerpt:

A few early reporting markets …

This is the first look at local markets in September. I’m tracking about 35 local housing markets in the US. Some of the 35 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.
...
From Denver Metro Association of Realtors® (DMAR): DMAR Real Estate Market Trends Report

Using months of inventory as a metric indicates that Denver Metro is moving toward a balanced market. … However, for many sellers, it likely feels like the rug has been pulled out from underneath them.

In September, sales were down 33.1%. In August, these same markets were down 32.4% YoY Not Seasonally Adjusted (NSA).

Note that in September 2022, there were the same number of selling days as in September 2021, so the SA decline will be similar to the NSA decline. Last month, in August 2022, there was one more selling day than in August 2021 - so seasonally adjusted, the decline in sales in August was larger than in September for these markets.

Many more local markets to come!

There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/

by Calculated Risk on 10/06/2022 08:33:00 AM

The DOL reported:

In the week ending October 1, the advance figure for seasonally adjusted initial claims was 219,000, an increase of 29,000 from the previous week's revised level. The previous week's level was revised down by 3,000 from 193,000 to 190,000. The 4-week moving average was 206,500, an increase of 250 from the previous week's revised average. The previous week's average was revised down by 750 from 207,000 to 206,250.
emphasis added

The following graph shows the 4-week moving average of weekly claims since 1971.

Click on graph for larger image.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims increased to 206,500.

The previous week was revised down.

Weekly claims were higher than the consensus forecast.

by Calculated Risk on 10/05/2022 09:01:00 PM

Thursday:
• At 8:30 AM ET, The initial weekly unemployment claims report will be released.  The consensus is for an increase to 203 thousand from 193 thousand last week.

by Calculated Risk on 10/05/2022 03:44:00 PM

From Moody’s Analytics Senior Economist Lu Chen: Office continues its bumpy ride, and Retail remains flat

Office vacancy has been persistently stuck at over 18% since early 2021, a consequence of excess inventories and strains on companies’ expansion plans. Net absorption rose in June and July, in line with the return to office sentiment, but that trend was short-lived as economic uncertainties pressured the sector’s fundamentals. The 3rd quarter ended with an increase in office demand, but the 1.75 million square feet (sqft) total net absorption was less than a third of the total construction delivery of around 6 million sqft. Office vacancy moved slightly upwards last quarter, but due to rounding remained at an elevated 18.4%, near its pandemic peak. Asking rent exceeded $35/sqft ($35.04), which is equivalent of 0.4% growth compared to last quarter. Effective rent kept pace, but that’s only half its rate in Q2.
emphasis added

Reis reported the office vacancy rate was at 18.4% in Q3 2022, unchanged from 18.4% in Q2, and up from 18.2% in Q3 2021. 

Q2 2021 at 18.5% was the highest vacancy rate for offices since the early '90s (following the S&L crisis) 

NOTE: This says nothing about how many people are in the offices (related to the increase in work-from-home), just whether or not the office space is leased.

Click on graph for larger image.

This graph shows the office vacancy rate starting in 1980 (prior to 1999 the data is annual).

The office vacancy rate was elevated prior to the pandemic and moved up during the pandemic.

Reis also reported that office effective rents increased 0.4% in Q3; rents are about at the same level as before the pandemic.

And from Reis on Retail:

Our data shows the national vacancy for neighborhood and community shopping center has stayed flat at 10.3% since a year ago, while asking/effective rent kept virtually unchanged in the 3rd quarter. Trend data on regional and super regional malls tells a similar story. Vacancy ticked up 10 basis-point to 11.1% and effective rent was up 0.1% this quarter. Despite some signs of stabilization, regional mall properties continue to be the most at-risk retail subtype according to our commercial mortgage delinquency data, and they are driving overall delinquency behavior among retail assets.

Reis reported that the vacancy rate for regional malls was 11.1% in Q3 2022, up from 11.0% in Q1 2021, and down from 11.3% in Q3 2021. The regional mall vacancy rate peaked at 11.5% in Q2 2021.

For Neighborhood and Community malls (strip malls), the vacancy rate was 10.3% in Q3, unchanged from 10.3% in Q2, and down from 10.4% in Q3 2021. For strip malls, the vacancy rate peaked during the pandemic at 10.6% in both Q1 and Q2 2021.

This graph shows the strip mall vacancy rate starting in 1980 (prior to 2000 the data is annual). The regional mall data starts in 2000. Back in the '80s, there was overbuilding in the mall sector even as the vacancy rate was rising. This was due to the very loose commercial lending that led to the S&L crisis.

In the mid-'00s, mall investment picked up as mall builders followed the "roof tops" of the residential boom (more loose lending). This led to the vacancy rate moving higher even before the recession started. Then there was a sharp increase in the vacancy rate during the recession and financial crisis.

In the last several years, even prior to the pandemic, the regional mall vacancy rates increased significantly from an already elevated level.

Effective rents have been mostly unchanged for regional malls over the last 4+ years, and flat for strip malls for 3+ years.

All vacancy data courtesy of Moody’s Analytics Reis

by Calculated Risk on 10/05/2022 11:54:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Apartments: Net Absorption Very Low in Q3, New Construction Deliveries Even Lower

A brief excerpt:

Moody’s Analytics also reported the effective rents were up 1.7% in Q3 from Q2, and up 10.2% year-over-year (YoY). This is a sharp slowdown from Q2 when rents were up 16.9% YoY.

Click on graph for larger image.

Last week, I posted a graph of the year-over-year change for various measures of rent. The Zillow measure is up 12.3% YoY in August, down from 13.8% YoY in July. This is down from a peak of 17.2% YoY in February. The ApartmentList measure is up 7.5% YoY as of September, down from 9.8% in August. This is down from the peak of 18.0% YoY last November.

Reis’ survey (dashed red) is quarterly and shows a similar slowdown in effective rents.
...
The bottom line is apartment demand was soft in Q3, household formation has slowed sharply, and there are a large number of apartments in the pipeline. We should see completions above net absorption soon, and the completion of all these units under construction should help with rent pressure.

There is more in the article. You can subscribe at https://calculatedrisk.substack.com/

by Calculated Risk on 10/05/2022 10:04:00 AM

(Posted with permission). The ISM® Services index was at 56.7%, down from 56.9% last month. The employment index increased to 53.0%, from 50.2%. Note: Above 50 indicates expansion, below 50 in contraction.

From the Institute for Supply Management: Services PMI® at 56.7% September 2022 Services ISM® Report On Business®

Economic activity in the services sector grew in September for the 28th month in a row — with the Services PMI® registering 56.7 percent — say the nation’s purchasing and supply executives in the latest Services ISM® Report On Business®.

The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “In September, the Services PMI® registered 56.7 percent, 0.2 percentage point lower than August’s reading of 56.9 percent. The Business Activity Index registered 59.1 percent, a decrease of 1.8 percentage points compared to the reading of 60.9 percent in August. The New Orders Index figure of 60.6 percent is 1.2 percentage points lower than the August reading of 61.8 percent.
emphasis added

This was above expectations.

by Calculated Risk on 10/05/2022 08:38:00 AM

From the Department of Commerce reported:

The U.S. Census Bureau and the U.S. Bureau of Economic Analysis announced today that the goods and services deficit was $67.4 billion in August, down $3.1 billion from $70.5 billion in July, revised.

August exports were $258.9 billion, $0.7 billion less than July exports. August imports were $326.3 billion, $3.7 billion less than July imports.
emphasis added

Click on graph for larger image.

Exports increased and imports decreased in August.

Exports are up 20% year-over-year; imports are up 14% year-over-year.

Both imports and exports decreased sharply due to COVID-19 and have now bounced back.

The second graph shows the U.S. trade deficit, with and without petroleum.

The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

Note that net, imports and exports of petroleum products are close to zero.

The trade deficit with China increased to $37.4 billion in August, from $21.7 billion a year ago.

The trade deficit was slightly lower than the consensus forecast.

by Calculated Risk on 10/05/2022 08:20:00 AM

Note: This is the second release of a new methodology. Historical data based on the new methodology is available.

From ADP: ADP National Employment Report: Private Sector Employment Increased by 208,000 Jobs in September; Annual Pay was Up 7.8%

Private sector employment increased by 208,000 jobs in September and annual pay was up 7.8% year-over-year, according to the September ADP® National Employment ReportTM produced by the ADP Research Institute® in collaboration with the Stanford Digital Economy Lab (“Stanford Lab”).

The jobs report and pay insights use ADP’s fine-grained anonymized and aggregated payroll data of over 25 million U.S. employees to provide a representative picture of the labor market. The report details the current month’s total private employment change, and weekly job data from the previous month. ADP’s pay measure uniquely captures the earnings of a cohort of almost 10 million employees over a 12-month period.

“We are continuing to see steady job gains,” said Nela Richardson, chief economist, ADP. “While job stayers saw a pay increase, annual pay growth for job changers in September is down from August.”
emphasis added

This was close to the consensus forecast of 205,000.  The BLS report will be released Friday, and the consensus is for 250 thousand non-farm payroll jobs added in September.

by Calculated Risk on 10/05/2022 07:00:00 AM

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 14.2 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 30, 2022.

... The Refinance Index decreased 18 percent from the previous week and was 86 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 13 percent from one week earlier. The unadjusted Purchase Index decreased 13 percent compared with the previous week and was 37 percent lower than the same week one year ago.

“Mortgage rates continued to climb last week, causing another pullback in overall application activity, which dropped to its slowest pace since 1997. The 30-year fixed rate hit 6.75 percent last week – the highest rate since 2006,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The current rate has more than doubled over the past year and has increased 130 basis points in the past seven weeks alone. The steep increase in rates continued to halt refinance activity and is also impacting purchase applications, which have fallen 37 percent behind last year’s pace. Additionally, the spreads between the conforming rate compared to jumbo loans widened again, and we saw the ARM share rise further to almost 12 percent of applications.”

Added Kan, “There was also an impact from Hurricane Ian’s arrival in Florida last week, which prompted widespread closings and evacuations. Applications in Florida fell 31 percent, compared to 14 percent overall, on a non-seasonally adjusted basis.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 6.75 percent from 6.52 percent, with points decreasing to 0.95 from 1.15 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.


The first graph shows the refinance index since 1990.

With higher mortgage rates, the refinance index has declined sharply this year.

The refinance index is at the lowest level since the year 2000.

The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is down 37% year-over-year unadjusted.

The purchase index is 5% below the pandemic low and at the lowest level since 2015.

Note: Red is a four-week average (blue is weekly).

by Calculated Risk on 10/04/2022 08:59:00 PM

Wednesday:
• At 7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• At 8:15 AM: The ADP Employment Report for September. This report is for private payrolls only (no government). The consensus is for 205,000 jobs added, up from 132,000 in August.

• At 8:30 AM: Trade Balance report for August from the Census Bureau.  The consensus is for the deficit to be $68.0 billion in August, from $70.7 billion in July.

• At 10:00 AM: the ISM Services Index for September.

by Calculated Risk on 10/04/2022 03:37:00 PM

The BEA released their estimate of vehicle sales for September this morning.

This graph shows heavy truck sales since 1967 using data from the BEA. The dashed line is the September 2022 seasonally adjusted annual sales rate (SAAR).

Heavy truck sales really collapsed during the great recession, falling to a low of 180 thousand SAAR in May 2009.  Then heavy truck sales increased to a new all-time high of 570 thousand SAAR in April 2019.

Click on graph for larger image.

Note: "Heavy trucks - trucks more than 14,000 pounds gross vehicle weight."

Heavy truck sales declined sharply at the beginning of the pandemic, falling to a low of 308 thousand SAAR in May 2020.  

Heavy truck sales were at 504 thousand SAAR in September, unchanged from 504 thousand in August, and up from 420 thousand SAAR in September 2021.  

Usually, heavy truck sales decline sharply prior to a recession.   Sales were solid in September.

by Calculated Risk on 10/04/2022 01:08:00 PM

Today, in the Calculated Risk Real Estate Newsletter: House Prices: 7 Years in Purgatory

A brief excerpt:

However, even in normal times, house prices are not sticky downwards in real terms as this graph shows.

In the July Case-Shiller report, real prices were only up 5.4% year-over-year (YoY) and will likely be down YoY in real terms later this year.

However, we are already seeing nominal house price declines on a national basis. The Black Knight index (median price of a repeat sales index) was off almost 2% in August, and the CoreLogic repeat sales index for August (a three-month weighted average and not seasonally adjusted, NSA) was off close to 1% in August. And my estimate is the nominal Case-Shiller national index will be off almost 1% in August compared to the peak in June.

There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/

by Calculated Risk on 10/04/2022 10:06:00 AM

From the BLS: Job Openings and Labor Turnover Summary

The number of job openings decreased to 10.1 million on the last business day of August, the U.S. Bureau of Labor Statistics reported today. Hires and total separations were little changed at 6.3 million and 6.0 million, respectively. Within separations, quits (4.2 million) and layoffs and discharges (1.5 million) were little changed.
emphasis added

The following graph shows job openings (black line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

This series started in December 2000.

Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for August the employment report this Friday will be for September.

Click on graph for larger image.

Note that hires (dark blue) and total separations (red and light blue columns stacked) are usually pretty close each month. This is a measure of labor market turnover.  When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.

The spike in layoffs and discharges in March 2020 is labeled, but off the chart to better show the usual data.

Jobs openings decreased in August to 10.053 million from 11.170 million in July.

The number of job openings (black) were down 5% year-over-year. 

Quits were up slightly year-over-year. These are voluntary separations. (See light blue columns at bottom of graph for trend for "quits").

by Calculated Risk on 10/04/2022 08:00:00 AM

Notes: This CoreLogic House Price Index report is for August. The recent Case-Shiller index release was for July. The CoreLogic HPI is a three-month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: Annual US Home Price Gains Lose Steam Again in August, CoreLogic Reports

CoreLogic® ... today released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for August 2022.

Although U.S. home prices continued their 127-month run of consecutive annual gains in August, they slowed for the fourth straight month to 13.5%. That’s the lowest year-over-year appreciation recorded since April 2021 and partially reflects continued cooling buyer demand due to higher mortgage rates and housing trends motivated by the COVID-19 outbreak winding down. The 0.7% month-over-month price decrease also indicates reduced homebuyer enthusiasm, with nearly three-quarters of states posting declines from July.

“The increased cost of homeownership has dampened buyer demand and caused prices to decelerate at a faster pace than initially expected,” said Selma Hepp, interim lead of the Office of the Chief Economist at CoreLogic. “Housing markets on the West Coast and in the Mountain West, as well as second-home markets, recorded particularly strong price growth in the summer of 2021 but were the first to see month-over-month price declines during the same period this year. While decelerating price growth and price declines benefit younger potential homebuyers, mortgage rates that are approaching 7% may cut many hopefuls out of the picture.”
...
U.S. home prices (including distressed sales) increased 13.5% year over year in August 2022 compared to August 2021. On a month-over-month basis, home prices declined by 0.7% compared to July 2022.
emphasis added

by Calculated Risk on 10/03/2022 08:28:00 PM

From Matthew Graham at Mortgage News Daily: Mortgage Rates Continue Recovering

Mortgage rates remain elevated in the context of the past decade and 2022 in general, but they continue making progress after hitting long-term highs early last week. ... The average lender is now getting back into the middle to upper-middle 6% range depending on the scenario and the presence of "points" in the loan quote. [30 year fixed 6.69%]
emphasis added

Tuesday:
• At 8:00 AM ET, Corelogic House Price index for August.

• At 10:00 AM, Job Openings and Labor Turnover Survey for August from the BLS.

by Calculated Risk on 10/03/2022 06:37:00 PM

Wards Auto released their estimate of light vehicle sales for September. Wards Auto estimates sales of 13.49 million SAAR in September 2022 (Seasonally Adjusted Annual Rate), up 2.3% from the August sales rate, and up 9.8% from September 2021. 

Click on graph for larger image.

This graph shows light vehicle sales since 2006 from the BEA (blue) and Wards Auto's estimate for September (red).

The impact of COVID-19 was significant, and April 2020 was the worst month.  After April 2020, sales increased, and were close to sales in 2019 (the year before the pandemic).  

However, sales decreased late last year due to supply issues.  It appears the "supply chain bottom" was in September 2021.

The second graph shows light vehicle sales since the BEA started keeping data in 1967.

Sales in September were at the consensus forecast of 13.5 million SAAR.

by Calculated Risk on 10/03/2022 03:56:00 PM

The FDIC's official problem bank list is comprised of banks with a CAMELS rating of 4 or 5, and the list is not made public (just the number of banks and assets every quarter). Note: Bank CAMELS ratings are also not made public.

CAMELS is the FDIC rating system, and stands for Capital adequacy, Asset quality, Management, Earnings, Liquidity and Sensitivity to market risk. The scale is from 1 to 5, with 1 being the strongest.

As a substitute for the CAMELS ratings, surferdude808 is using publicly announced formal enforcement actions, and also media reports and company announcements that suggest to us an enforcement action is likely, to compile a list of possible problem banks in the public interest.

DISCLAIMER: This is an unofficial list, the information is from public sources only, and while deemed to be reliable is not guaranteed. No warranty or representation, expressed or implied, is made as to the accuracy of the information contained herein and same is subject to errors and omissions. This is not intended as investment advice. Please contact CR with any errors.

NOTE: I'm no longer updating the spreadsheet.

Here are the quarterly changes and a few comments from surferdude808:

Update on the Unofficial Problem Bank List through September 30, 2022. Since the last update at the end of June 2022, the list decreased by one to 51 institutions after an addition and two removals. Assets decreased by $2.9 billion to $51.5 billion, with the change primarily resulting from a $2.2 billion decrease from updated asset figures through June 30, 2021. A year ago, the list held 59 institutions with assets of $54.9 billion. Added during the third quarter was Unity National Bank of Houston, Houston, TX ($246 million). Removals during the quarter because of action termination included Southwestern National Bank, Houston, TX ($884 million) and Amory Federal Savings and Loan Association, Amory, MS ($74 million).

With the conclusion of the third quarter, we bring an updated transition matrix to detail how banks are transitioning off the Unofficial Problem Bank List. Since we first published the Unofficial Problem Bank List on August 7, 2009 with 389 institutions, 1,785 institutions have appeared on a weekly or monthly list since then. Only 2.9 percent of the banks that have appeared on a list remain today as 1,734 institutions have transitioned through the list. Departure methods include 1,024 action terminations, 411 failures, 280 mergers, and 19 voluntary liquidations. Of the 389 institutions on the first published list, only 3 or less than 1.0 percent, still have a troubled designation more than ten years later. The 411 failures represent 23 percent of the 1,785 institutions that have made an appearance on the list. This failure rate is well above the 10-12 percent rate frequently cited in media reports on the failure rate of banks on the FDIC's official list.

On September 8, 2022, the FDIC released second quarter results and provided an update on the Official Problem Bank List. While FDIC did not make a comment within its press release on the Official Problem Bank List, they provided details in an attachment that listed 40 institutions with assets of $170 billion. In its 2022 first quarter release, the FDIC list had a material $119 billion increase in assets. Since that release, none of the prudential banking regulators – FDIC, Federal Reserve, and OCC – have publicly released an enforcement action detailing an enforcement action against a large institution. The Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) passed by Congress in 1989 requires publication of enforcement actions. See “Supervisory Enforcement Actions Since FIRREA and FDICIA,” published by the Federal reserve Bank of Minneapolis for further details. Prior to FIRREA, enforcement actions were not published by the prudential banking regulators. Section 913 of FIRREA requires public disclosures of enforcement actions. Section 913(2) does allow a delay in the enforcement action publication if “exceptional circumstances” exist. The prudential regulator must make a written determination that publication “would seriously threaten the safety & soundness of an insured depository institution.” The prudential regulator “may delay the publication of such order for a reasonable time.” The section does not define “a reasonable time.” It has been more than six months since that enforcement action was issued, so it seems the primary regulator considers this a “reasonable time” before it informs the public of a large, troubled institution.

Regulators still haven't disclosed the "whale" (that added close to $120 billion to problem assets).