The Subprime 25: The Top 25 Lenders Responsible For Almost $1 Trillion Of Subprime Loans

Today, the Center for Public Integrity releases the results of its investigation into the housing crisis, which showed that investment banks, some of which were recipients of billions of taxpayer dollars through the federal bailout, made major investments in subprime lending.

"The top subprime lenders whose loans are largely blamed for triggering the global economic meltdown were owned or bankrolled by banks now collecting billions of dollars in bailout money -- including several that have paid huge fines to settle predatory lending charges," write John Dunbar and David Donald.

"The banks made huge profits and executives collected handsome bonuses until the bottom fell out of the real estate market."

According to their analysis, 21 of the top 25 subprime lenders were either owned or partly financed by one or more of the top bailed-out banks.

Among those banks: Lehman Brothers, Merrill Lynch, JP Morgan, Citigroup, Goldman Sachs.

Click here to read the rest of the report.

Here is the list of the top 25 subprime lenders based on the center's analysis of data collected on almost 7.2 million high-interest mortgages.

The center's investigation also features maps showing where the top 25 subprime lenders originated most of their high-interest mortgages from 2005 through 2007, the period that marks the peak and collapse of the subprime boom.

Comments

[banker67]

10:17 PM on 05/07/2009

And what of the reported 52,000 American millionaires who evaded lawful U.S. taxes for the past eight years by opening accounts at the Swiss USB bank?

How is it possible that these vermin can legally evade the taxes the rest of us perish to pay, and yet the IRS and the U.S. government can't do anything about it?

If the IRS can find a questionable $32 deduction on every teacher's 1040, it is absurd to claim they can't nail these 52,000 tax evaders. Of course they can. They just won't and they can hire 10,000 lawyers to tell the public why it's just not possible.

And of course that's at just one foreign bank.

Those govenment officials who got fat salaries and life-long benefits under the Cheney administration must have worked like demons to make sure those multi-millionaires never paid U.S. taxes.

This scandal is one of the biggest. Now that it is so very obvious that the wealthiest Americans don't have to pay any taxes at all, the entire tax system becomes (even more of ) a joke.

Now that we know the GOP appointees did all they could to exempt the big donors from our nation's income tax laws, who can possibly make the case that the W-2 set should make the smallest effort to pay income taxes?

So how many of the swine connected with these criminally managed banks have accounts with USB? Time we found out.
BB

[Candw1]

07:25 PM on 05/07/2009

Don't all you people realize that this mess is partly our fault. Americans having been spending money they did not have for years. If Americans didn't live off their credit cards, people would not be drowning in debt to these blood suckers. There is something about using plastic, it doesn't seem like spending REAL money.

Americans have been living in a dream world. Easy credit, a wallet full of credit cards that are maxed out, buying huge homes, expensive cars, the latest and greatest gadgets, conspicuous consumption has brought us all to where we are today. What's wrong with being out of debt, standing on our own and not owing money to creditors and parents, what's wrong with saying NO to the overly excessive demands of our ourselves and our children. No is not a dirty word.

"No we can not afford it", is something we must start saying more often to ourselves and our kids. And in my opinion it is about time, we will all be better off for it, that's a lesson worth learning. For far too long we have been living with the attitude,"to hell with tomorrow because I want it today".......well the hell of tomorrow is here......even for the people that lived within their means. So when you look to someone/anyone to blame for all this mess....also take a look into the nearest mirror .

[meemu]

05:32 AM on 05/07/2009

I am not surprised by this article. One tries not to become cynical, but it's impossible when day after day we read stories which prove that cynicism is justified. I 'suspected' that it was all intertwined, and I'm sickened by the whole scenario I see before me. I'm glad I'm not among the 'elite' because I'd be sickened by myself.......at least I don't deliberately try to tear down everyone else around me, so that I can feel 'Elite'.

[allenels]

01:47 AM on 05/07/2009

I lost my house last Thursday. I have been fighting for over a year but the inevitable occurred. The bank that foreclosed on my home, First Federal Bank, is currently under the steerage of the OTS. First Federal has also received a pass on having to pay interest on $150,000,000.00 in public debt for two years. Think how different my life and the lives of the 2.6 million other homeowners who have already lost their homes to foreclosure and the 2.2 million who are projected to lose their homes this year if they had received a pass on their interest payments for two years.
Just why is it okay for these institutions to foreclose and take homes from families, many of whom who had worked and paid thei monthly payments many years before sub-prime loans became popular, and receive our tax dollars to tide them over during this economic downturn and then turn their backs on the very consumers who made them wealthy in the first place?
Americans, the bankers are screaming "Let them eat cake" and we haven't made enough noise to make the Obama administration hear our needs. The bailout is a failure because it's the American people and not the banks and Wall Street firms who need and deserve a bailout!
Geithner can't see what's in front of him because he's part of the problem. Obama must opt out of using the people who put our economy at risk in the first place.

[Artemis34]

03:27 AM on 05/07/2009

I'm sorry allenels. Love the "Let them eat cake" reference.

Hang in there!

[PhilipTaylor]

12:17 AM on 05/07/2009

OUTRAGE LIST-What is wrong in America:

1. A Justice System that does NOT WORK.

2. A Campaign Funding System that sells the Votes of Senators, House Members, and the President to the highest bidders. Wall Street giving Congress $5 Billion.

3. $Trillion taken from the Taxpayers and Given to the Cr!minal Elites.

4. No government support for the 99% of Americans who work hard and are Harvested by the Elites at intervals.

5. Wall Street Elites taking from the Taxpayers to line Employee Pockets. AIG used $454 Million to pay employees Bonuses.

6. Wall Street Executives/Employees skimming $Trillion of Bank Profits into the pockets of employees.

7. Congress puts laws forward to help the Middle-Class but repeatedly at the last moment allows Lobbyists to rewrite the law to remove the Middle-Class Help or the Wall Street Correction of Corruption.

8. No Investigation or Prosecution of T0RTURE cr!me charges.

9. Use of DELAY and Diversionary Fake News as TOOLS to prevent investigation and prosecution.

10. No investigation of Wall Street Cr!imes, but instead rewarding Wall Street for Massive Failures and Cr!mes.

[Artemis34]

11:56 PM on 05/06/2009

As Yogi Berra would say, "It's like déjà vu all over again!"

I’d like to see a thoughtful comparison to this with the Savings & Loan crisis of the late ‘80s. Has anyone seen a good comparison?

As I recall, conservatives, Reagan and Bush had been leading a wave of deregulation in the ’80s.

Despite what the S&L’s had said about Adjustable Rate Mortgages, interest rates were going DOWN but people with ARMs had their payments going UP to levels they could not afford. By the late ‘80s, the Savings & Loans were foreclosing.

In 1989, S&Ls were going bust and we had to bail them out.

See History of U.S. Gov't Bailouts:
http://www.propublica.org/special/government-bailouts#savingsloan

The big losers were the American people. Certainly no executive at any S&L lost. They retained their wealth.

I’ve had two mortgages in the US and both were 30 year fixed. I’m not sure I would have avoided the ARM rip-off if I hadn’t seen all the pain and suffering of everyday people during the S&L crisis.

[Carolab]

10:59 PM on 05/06/2009

Neighborhood Assistance Corporation of America (NACA) -- national activist group working to renegotiate mortgages, and save people from foreclosure.

Demonstrations held at banking executives homes in Connecticut, the Hamptons, etc.

ACCOUNTABILITY CAMPAIGN

Executives of financial institutions have amassed huge fortunes on the backs of hardworking American families. While living in their many luxurious homes, they have refused to restructure mortgages that would allow families to stay in their homes. We need to make them accountable for their actions. Join the fight.

While NACA has agreements with many lenders to make mortgages affordable, the below executives refused.

The list of predators includes:

HSBC, Barclay's, Credit Suisse (all foreign bank owners of the Fed and all received TARP money)
-Safra Katz, Brendan Mcdonagh (HSBC), Robert Shafir (Credit Suisse), Robert Diamond (Barclay's)

PIMCO (asset manager for the GSEs -- Alan Greenspan senior consultant), Bill Gross and Mohamed El-Erian

Carrington Management Services - Bruce Rose

Freddie Mac (!) - David Moffett

Fortress Investment - Wesley Edens

National City Bank - Peter Raskind (PNC took TARP money and bought National City in October, The Pittsburgh bank revealed plans to scoop up struggling regional bank National City for about $5 billion in stock . At the same time, it said it would sell $7.7 billion of equity to the treasury.)

Greenwich Financial - William Frey (managing director Andrew Szabo is from Lehman and UBS

American Securization Forum - Jason Kravitt and Ralph Daloisio

https://www.naca.com/index_main.jsp?language=null

[Carolab]

11:08 PM on 05/06/2009

Note:

Bill Frey (Greenwich FInancial) is representing a class of investors who bought mortgage backed securities (MBS) from Countrywide that had a specific repurchase clause that if Countrywide modified these loans, they would have to buy them back at full face value.

(And of course we know that PennyMac and its team of former Countrywide executives is buying these delinquent mortgages for 38 cents on the dollar from "the government" and modifying them now.)

When B of A arbitrarily agreed to settle with the state Attorney General to modify $8.4 billion in mortgages, they basically broke the terms of the said contracts on these mortgage backed securities.
_____________

Countrywide, the nation's biggest lender as the mortgage crisis hit, agreed in October to modify mortgages for about 400,000 homeowners to settle allegations of predatory lending. Countrywide was bought by Bank of America in July.

In the class action filed in December, or group lawsuit, the Greenwich, Connecticut-based hedge fund demanded a declaration that “Countrywide must purchase at par every mortgage loan that it sold to any of the 374 securitization trusts,” David Grais, a lawyer for the fund said in an e-mailed statement. Grais said Countrywide could owe the trusts $80 billion.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aOaEM25JlUqk&refer=us

[Artemis34]

10:31 PM on 05/06/2009

I liked the graph at

http://www.publicintegrity.org/investigations/economic_meltdown/assets/img/Chart6-fullsize.jpg

Skyrocketing costs, in this case housing costs, and stagnant incomes over the last 8 years.

Inflation is the worst kind of taxation and that is what we get with conservatives.

[CitizenFarmer]

09:38 PM on 05/06/2009

These are all buddies of Rahm, Timmy G, and Robbie Rubin.

[Artemis34]

12:06 AM on 05/07/2009

The current administration inherited this mess. All they can do now is try to pick up the pieces.

Are you observing that people with financial expertise come from the financial industry? I think most would accept that as a given, regardless of the party in the White House.

[TXfemmom]

04:34 PM on 05/06/2009

Go back, investigate all of the rascals involved, charge them with RICO. seize what assets they have and then send them all to the nastiest, dirtiest, meanest federal pen we have.

[Artemis34]

10:28 PM on 05/06/2009

The detailed article says, that in many cases, they were found guilty of wrong-doing and fined. Then we gave them bail-out money. So, essentially they paid the fines with taxpayer money.

Nationalize the banks. We've already paid for them. We just need to take control.

[sexyrexy]

02:59 PM on 05/06/2009

they should all go hung.. and have everyone get their homes free & clear.. as these bailed out banks were already paid by us-- the tax payers!

[plaidsportcoat]

01:57 PM on 05/06/2009

EXCUSE ME - THIS SHOULD BE THE HEADLINE today.

[rich misty]

01:56 PM on 05/06/2009

Republican Jesus went to the Temple, and he set up tables. He invited thieves to attend them, and he smiled as they extracted usury from the poor and homeless. He told his followers to support, and protect, The Money Changers.

http://www.youtube.com/watch?v=kNqQx7sjoS8

For those who think I am not absolutely serious... The Republican Bible is online.

"We will use money, taxpayer money, to bankrupt America" ~48 seconds in

[Oonagh]

01:28 PM on 05/06/2009

And this is news to who? The reason these banks got into such trouble was because of their greed and their stupidity in the real estate business.

[eladora]

01:18 PM on 05/06/2009

Best article. shows that the biggest predators are still in the business and that Congress continues to look the other way. Unbelievable.