Richard Suttmeier is the Chief Market Strategist at www.ValuEngine.com.

ValuEngine is a fundamentally-based quant research firm in Princeton, NJ. ValuEngine

covers over 5,000 stocks every day.

A variety of newsletters and portfolios containing Suttmeier's detailed research, stock picks,
and commentary can be found HERE.

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February 18, 2010 – The ValuEngine List of Problem Banks

Tracking the ValuEngine List of Problem Banks, summarizing the status of the housing market,
as Mortgage delinquencies continue to rise. The Fed’s potential quantitative tightening
ValuEngine List of Problem Banks – Next week the list will be updated with the Q4 FDIC
Quarterly Banking Profile.
Problem banks are publicly traded FDIC insured financial institutions who are overexposed to
Construction & Development Loans and/or Nonfarm nonresidential real estate loans, with “1-Engine”--
Strong Sell, or “2-Engine”—Sell. We also include all other engine-rated banks-- and those with “n/a”
ratings but forecast figure data points according to our models-- in violation of FDIC guidelines vis-a-vis
loan exposures.
Those that are not covered by ValuEngine due to poor fundamentals or because there is no available
EPS estimate but are still in violation of FDIC guidelines are also listed in the ValuEngine FDIC Report.
As of February 15, 2010, there were 228 publicly traded banks overexposed to C&D and/or CRE loans
in the ValuEngine database with full data coverage. Of these overexposed banks, 85 were rated “1-
Engine” Strong Sells, 64 were rated “2-Engine” Sells—all of which are predicted to under perform the
markets as a whole, 72 were rated “3-Engine” Holds—which are predicted to roughly match the overall
market, 7 were rated a “4-Engine” Buy, and none held our highest rating of “5-Engine” Strong Buy—
with the 4 and 5-Engine stocks predicted to out perform the overall market.
There are 755 publicly traded FDIC insured financial institutions overexposed to C&D Loans or
Nonfarm Non-Residential Real Estate loans as per the FDIC's own guidelines. This means that there
are currently 149 banks rated Sell or Strong Sell that are also overexposed to C&D and/or CRE loans.
There are 186 overexposed institutions with only partial ValuEngine coverage and thus those banks
have no rating--these are included in the problem bank list. There are 341 additional institutions
carrying C&D and/or CRE loans in excess of the FDIC guidelines that do not appear in the ValuEngine
database.

Failed ValuEngine Problem Banks

Below is a list of the 38 banks that failed in 2009 / 2010 which were tracked by our ValuEngine List of
Problem Banks and FDIC loan exposure data. Banks that have failed since our last report are
highlighted in RED. With more bank failures on the horizon, you can track our Problem List by
subscribing to the ValuEngine FDIC Report.
Ticker Company Name ASSET C&D Loans C&D Ratio CRE Ratio Pipeline
AFNL.PK AmTrust Financial Corporation 11,428,318 1,205,801 334.8% 335.9% 100.0%
BHBC.PK Beverly Hills Bancorp 1,260,354 127,805 238.1% 1447.4% 84.7%
CAPB.PK CAPITALSOUTH BANCORP 586,586 87731 723.2% 2188.2% 89.2%
CAPE Cape Fear Bank Corp. 492,418 136,084 448.6% 870.5% 95.9%
CBBO Columbia Bancorp 1,062,110 181,553 487.6% 1127.1% 97.6%
CBON Community Bancorp 1,556,315 661578 4318.1% 6930.9% 89.7%
CNB Colonial Bancgroup 25,455,112 4262980 276.8% 595.0% 86.8%
COOP Cooperative Bankshares 966,778 390,743 868.6% 1105.3% 85.6%
CORS Corus Bankshares, Inc. 7,003,321 3249387 2066.0% 2315.9% 81.0%
EBDC.OB Ebank Financial Services 144,688 13086 330.1% 577.8% 100.0%
EVGG.OB Evergreenbancorp, Inc. 488,516 81,916 435.6% 1502.9% 87.6%
FAFL.PK First Americano Financial Corp 163,372 21871 726.1% 2698.9% 76.6%
FCWT.OB First Coweta Bank 163,755 46337 922.1% 1503.9% 97.7%
FFED.PK FirstFed Financial Corp. 6,143,903 4,169 1.4% 640.6% 100.0%
FFSX First Federal Bankshares Inc. 503,462 31332 112.6% 531.0% 100.0%
FLRB.OB Florida Community Banks Inc. 875,473 305,342 1034.3% 1470.1% 96.5%
FRGB First Regional Bancorp 2,184,100 690,160 508.9% 1137.1% 89.9%
FSTF First State Financial Corporation 447,667 61841 602.0% 2395.8% 95.7%
GAFC.PK Greater Atlantic Financial Corp. 203,262 6,200 141.5% 936.5% 100.0%
GBFL.OB Great Basin Financial Corp 238,940 14,265 163.0% 743.0% 88.5%
GFG Guaranty Financial Group 13,464,352 2774913 301.6% 555.2% 100.0%
HRZB Horizon Financial Corp. 1,299,986 291,412 1395.9% 3003.2% 90.4%
IFC Irwin Financial Corporation 3,357,898 371480 141.2% 623.6% 92.0%
IMPC.PK Imperial Capital Bancorp, Inc 4,046,888 333,338 166.4% 1259.7% 90.7%
MHBC.OB Michigan Heritage Bancorp 167,710 16,855 406.8% 917.6% 93.0%
MPBK.OB MetroPacific Bank CA 75,316 10,494 301.0% 804.9% 98.6%
MRAB.OB Mirae Bancorp 480,619 1,119 22.9% 1270.6% 46.3%
NWCB.PK Newnan Coweta Bancshares 212,616 65,908 902.1% 1426.0% 96.6%
PCBI Peoples Community Bancorp 606,153 71711 1621.7% 3724.1% 100.0%
PCST.OB Pacific Coast National Bancorp 153,446 22018 345.0% 1239.1% 95.2%
PNVL.OB Prineville Bancorporation 199,508 28062 2553.4% 8154.7% 92.0%
SJQU.OB San Joaquin Bancorp 832,807 160514 320.2% 1021.9% 81.7%
SBKC Security Bank Corporation 2,382,010 852704 1902.0% 2782.9% 93.8%
SNCB.PK Southern Community Bancs 371,695 97,131 588.0% 1050.8% 98.4%
TMCV Temecula Valley Bancorp Inc. 1,396,622 387240 1021.7% 2752.3% 83.4%
UCBH Ucbh Holdings, Inc. 12,789,793 1582803 211.0% 678.4% 72.3%
VNBC.PK Vineyard National Bancorp 1,638,378 495573 2638.3% 5902.0% 94.2%
WGNB WGNB Corp. 832,580 141,973 1025.7% 2071.4% 97.6%
Builder Confidence Inches Higher - Touting an increase to 17 from 15 for the NAHB Housing Market
Index is like finding a pulse. The NAHB cited signs of healing in the jobs market, continued low
mortgage rates and the tax credits for this sober bounce in an index where 50 is neutral. Based upon
this reading to be optimistic doesn’t this index need to be above 50? A reading of 17 by definition has to
imply that confidence is “very poor.”
Housing Starts Rise in January - An annual rate of 591,000 units is just a bounce due to the tax
credits. To show that the tax credit window is small ending on April 30th for contracts, Building Permits
declined 4.9%. Getting a home financed and built by June 30th is becoming a stretch.
Not helping housing is higher Q4 2009 Mortgage Delinquencies - The percentage of quarterly
delinquencies reached another record in the fourth quarter, as 8.9% of mortgage payments were 60
days or more past due, up from 6.25% in the third quarter of 2009. Keep in mind that there remains that
wave of adjustable rate mortgages that were set in 2006 and into 2007 that are in the window of the
three to five year resets.
Fed Considering Quantitative Tightening - We appear to be stuck with a zero percent funds rate, put
the Federal Reserve appears close to cut back cash in the banking system buy selling securities
bought during quantitative easing. The Fed is unlikely to be too aggressive, as they worry about a
continued elevated unemployment rate.
Send me your comments and questions to Rsuttmeier@Gmail.com. For more information on our
products and services visit www.ValuEngine.com
That’s today’s Four in Four. Have a great day.

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Richard Suttmeier
Chief Market Strategist
www.ValuEngine.com
(800) 381-5576
As Chief Market Strategist at ValuEngine Inc, my research is published regularly on the website www.ValuEngine.com. I
have daily, weekly, monthly, and quarterly newsletters available that track a variety of equity and other data parameters as
well as my most up-to-date analysis of world markets. My newest products include a weekly ETF newsletter as well as the
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issues of my research.

“I Hold No Positions in the Stocks I Cover.”