Gunpowder Chronicle posted on September 13, 2008 10:55 PM | Rating:
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Ed Hale is well on his way to bringing down yet another Baltimore bank. This time, it is the one he founded, 1st Mariner Bank. The bank's stock has seen a precipitous slide as of late, dropping as low as $1.67/share before rebounding a day later upon intervention by FOEs (that is "Friends of Ed"). He has been laying off people at a quick clip, including key leaders that possess intimate information about bank operations that the FDIC (and his customers) would be shocked at. And the slide continues...
The Director of Marketing resigned this week, as the FDIC and the State were in the offices running yet another fine-toothed comb through the books. The systems department lost a key team member who was part of a major server conversion.
His asset/debt ratio remains precipitously low, fueled by his avarice, greed, and fundamental lack of oversight over his loan officers. His regulatory agreement with the Federal Reserve Bank in Richmond might be in jeopardy, as they are scheduled to show up Monday or Tuesday for their pass at the company books.
And questions surround the opening of the newest branch in Westminster, coming on the heels of the closing or sale of several others.
And in the FBI investigation into the former loan office in Northern Virginia -- which wrote millions of dollars of fraudulent loans -- goes on, without hope of restitution or resolution. The bank's insurance company is refusing to cover the losses as they see the future potential of recovery of the losses AND they question if the losses could have been avoided through stronger oversight.
He and his fellow officers have had to take serious pay cuts -- although they still make too much for doing too little, and what they do accomplish, they screw up.
Meanwhile, Ed's other little enterprise -- Canton Crossing, LLC -- had to resort to an infusion of financing from COPT in the form of mezzanine financing in order to pay off a builder's lien and a broker's lien against his tower -- and 1st Mariner's headquarters. It's surprising that COPT would jump into this foray, given that Ed took a major blow when the City chose to build a new arena on the site of the existing one, and ignored his plans for Canton. And his expansion plans for Canton Crossing - mixed-use retail and residential -- are slowing down as the eastward reach of redevelopment stalls.
Finally, his political prospects and friends are running away like he is a leper. The failure of his PAC to provide meaningful financing to Democrat candidates in Maryland -- and his subsequent failure to bundle large donations for national candidates -- are crimping his connections. And with Mayor Sheila Dixon under fire for her ethical issues and involvement with developers, she sees him as majorly radioactive at this point.
1st Mariner is taking on water fast. And pretty soon, even the rats will start jumping ship.