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Feds Shut Down Broadway Bank

By Marcus Gilmer in News on Apr 24, 2010 4:15PM

The FDIC shut down seven banks in Northern Illinois yesterday but none as high profile as Broadway Bank, the bank owned by the family of Democratic U.S. Senate candidate Alexi Giannoulias. The bank was unable to raise the required $85 million of capital to keep the feds from taking over. MB Financial now takes control of the bank's assets. Chief Executive Demetris Giannoulias said in a statement last night: "This is a difficult day for bank employees, for my family, for this community and for all those who built businesses and protected their savings with the help of this bank. We fought to carry out the vision my father had when he founded Broadway Bank 30 years ago, but our bank -- like many businesses -- has struggled during these challenging times." Giannoulias himself had this to say:

"It is an incredibly sad and heartbreaking day for me and my family. My father and my brothers have changed the lives of so many families and entrepreneurs, both in the Edgewater community and throughout the country. Â…While today was a devastating day for me and my family, what happened today makes me want to fight even harder for Illinois families that have lost their jobs, their homes and their own businesses."

So what happens to Giannoulias' election odds? Well, it can't be good when your party's leader - Mike Madigan - cracks, "I'm glad I don't have any deposits there." Could David Hoffman be getting a call soon? One would think such a move would be disastrous especially in the wake of the Scott Lee Cohen affair. And with there already being a great amount of attention on the bank and some of the recipients of loans it's made, there will be even more scrutiny in the coming weeks. But Giannoulias' chances have taken another big hit and the Dems find themselves backed into a corner. The Reader has a few more helpful links on the story and Capitol Fax highlights that MB Financial received $193 million in bailout money.

The other banks to fail were: Rockford-based Amcore Financial, Chicago-based Lincoln Park Savings Bank, Chicago-based New Century Bank, and Citizens Bank & Trust Co. of Chicago. Additionally, the FDIC seized Wheatland Bank of Naperville and Peotone Banke and Trust Co.