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Indian-American Bank Fails in Illinois

by Christopher Menkin


In reviewing the failures of banks taken over by the FDIC in the last three years, the majority of the bank directors had little lending, let alone banking experience, or knowledge for the positions that they held. Many had attracted investors, who were their friends, who they also promoted loans and other banking relationships. They contributed directly to the failure of their bank.


All American Bank, Des Plaines, Cook County, Illinois, is the 85th FDIC-insured institution and smallest bank to fail in the nation this year, and the ninth in Illinois. According to Highbeam Business, the bank was catering to Indian-Americans since its launch. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $6.5 million. International Bank of Chicago, Chicago, Illinois, to assume all of the deposits.

All American Bank was established August 15, 2005 and had nine full time employees. As of September 30, 2011, All American Bank had approximately $34.8 million in total assets and $30.5 million in total deposits. In addition to assuming all of the deposits, International Bank of Chicago agreed to purchase essentially all of the failed bank's assets. Both assets and deposits were down from June 31, 2011, when All American Bank had approximately $37.8 million in total assets and $33.4 million in total deposits, according to FDIC records.

September 30, 2011: Tier 1 risk-based capital ratio 2.62%

June 21,2010 the FDIC issued a Consent order for the board to get more involved with the operation of the bank, employees to be held accountable for following "policies, procedures and regulatory requirements," obtain a compliance officer within 60 days, administer programs of compliance, training programs, and basically get the bank in better order."

In reporting on bank failures for the last three years, most were profitable in 2006, with perhaps some exceptions in Florida, but here is a bank that had losses prior to the mortgage meltdown and the losses far outceded the charge offs, giving further indication to the poor management of the bank.

Officers and Directors

  • Varghese Chacko, Chairman/Founder (Insurance agent)
  • Jacob Chacko, Director (Alert Medical Supplies, Secretary)

(no information found on these directors)

  • Frenny Christian, Director
  • Joseph Mullappillil, Director
  • Joseph Myalil, Director
  • Thogaru Nandan, Director
  • Milton Pandya, Director
  • Issac Plamoottil, Director
  • Jude Cresto was president of the bank
  • Maslike Visram, Vice President/Chief Credit Officer
  • Eliza Aleman, Branch Manager
  • Jose Aquino, Controller

(in millions, unless otherwise)

Net Equity

2006 $7.8
2007 $7.2
2008 $5.0
2009 $2.2
2010 $1.8
6/31 $829,000
9/30 $701,000


2006 -$832,000
2007 -$558,000
2008 -$2.2
2009 -$2.8
2010 -$400,000
6/31 -$1.0
9/30 -$1.1

Non-Current Loans

2006 $913,000
2007 0
2008 $1.9
2009 $5.2
2010 $6.7
6/31 $6.0

Charge Offs
2006 $3,000 ($3,000 loans to individuals)
2007 $82,000 ($82,000 commercial and industrial loans)
2008 $47,000 ($47,000 loans to individuals)
2009 $348,000 ($235,000 1-4 family residential properties, $77,000 commercial, $36,000 other)
2010 $1.2 ($1.29 1-4 family residential properties, -$20,000 other loans)
6/31 $1.08 ($707,000 construction/land, $221,000 nonfarm, $163,000 1-4 family, -$11,000 other)
9/30 $1.09 (rounded off)

Construction and Land, 1-4 family multiple residential, Multiple Family Residential, Non-Farm Non-Residential loans.

List of Bank Failures:

Bank Beat: