Bauer Financial Bank Ratings

http://www.bauerfinancial.com/btc_ratings.asp

USBI statements filed with the SEC

USBI statements filed with the SEC

A Deposit-Protection Primer

A Deposit-Protection Primer
Bank Troubles Spur Jitters Among Customers
By SHELLY BANJO
July 26, 2008; Page B2

It has been two weeks since IndyMac Bank was seized in the third-largest bank failure in U.S. history, and even much healthier banks still are getting calls from customers worried about the safety of their money.
[Indymac]
Getty Images
Bank's seizure has consumers wary.

KeyCorp customers "are really trying to understand better what's insured...how you spread accounts," Henry L. Meyer III, the Cleveland-based bank's chief executive, told analysts and investors on a conference call. He made sure to note that "we are not seeing runs [or] walks" on the bank and that KeyCorp's deposits actually grew during the previous week.

Still, banking regulators are girding themselves for more bank failures, though far fewer are likely than the 834 that went under from 1990 to 1992.

Banks in general are suffering. The combined second-quarter net loss this year was $5.2 billion by the 10 largest U.S. banks and thrifts by deposits, holding about 40% of the nation's total. That compares with profit of $24.4 billion a year earlier. Meanwhile, the same financial giants increased their combined loan-loss provision to $32.5 billion in the latest quarter from $7.6 billion.

Here are answers to commonly asked questions by worried bank customers:

Question: What causes a bank to fail?

Answer: Regulatory bodies decide to close a financial institution when its capital levels fall too low or it can't meet its obligations for the next day.

Q: How do customers find out if their bank is at risk?

A: One way to track that is via the free Safe & Sound bank-rating feature at Bankrate.com. Bauer Financial issues more detailed bank reports for $10-$50 at www.bankstars.com.

But these offer clues, not definitive government judgments. Consumers don't have access to the FDIC's "problem list" of banks. In the first quarter, there were 90 institutions on the list. "Only about 13% fail on any given year," FDIC spokesman Andrew Gray said.

Q: Are deposits safe?

A: The Federal Deposit Insurance Corp. covers individual accounts up to $100,000 per depositor per bank or $250,000 for most retirement accounts (and that includes any accrued interest). Deposits held in the same bank, under additional categories of ownership, such as trusts, may be insured separately.

The FDIC doesn't insure money invested in stocks, bonds, mutual funds, life-insurance policies, annuities or municipal securities.

FDIC.gov, the FDIC's Web site, has more information, or call its consumer hotline at (877) 275-3342.

Q: What about uninsured deposits?

A: Amounts over $100,000 can be partially reimbursed after some time and trouble, with the money coming from sales of the failed bank's assets. In general, depositors eventually get 70% to 80% of their funds returned.

In some cases, such as IndyMac's, depositors have access to 50% of their uninsured deposits right after the failure.

Q: Brokered deposits?

A: Deposits held through brokerages are FDIC-insured up to the same amount as funds deposited directly into the bank. But it could take considerably longer to get access to these funds when a bank fails. Bank records show the broker's name on deposits -- not the customer's -- so it is up to the broker to provide ownership information to the FDIC and then parcel the funds out to customers.

Q: How do people find out that their bank is being closed?

A: When banks close, which usually happens on a Friday, customers are alerted through the local media and an announcement in the bank window. Banks generally open for business as usual on Monday.

Q: What happens to the failed bank's assets?

A: Typically all or most assets are acquired by another institution. Customers can decide to stay with the new bank or move their money to other banks.

Q: Do customers of the failed bank have access to their money during the transition?

A: In most cases customers have access to their insured funds over the weekend and can use ATMs, debit cards and write checks. Sometimes when the bank isn't immediately taken over by another institution, customers can't tap their funds but will receive a check for their insured deposits as early as the Monday after the bank closed.

Q: Do customers have access to business accounts for such things as paying employees?

A: Payroll accounts are considered part of the business' deposits, insured up to $100,000 maximum per entity.

Q: Can depositors move some or all of their funds to another bank?

A: They have full access to all insured funds when the bank reopens Monday and can withdraw money. They can move the funds to another bank, but there is no need, the FDIC's Mr. Gray said.

In most cases, for certificates of deposit that have not matured yet, customers can take out the money without facing penalties.

Q: If customers keep funds in the new bank, will interest rates and terms of loans change? Should they keep making payments on loans?

A: Initially, accounts earning interest will continue to do so at the same rates and terms, but after time the new institution may change them. The terms of mortgages, car or other loans are "contracts and won't change," Mr. Gray said. In addition, any electronic transactions and payments from reverse mortgages will continue.

Write to Shelly Banjo at shelly.banjo@wsj.com1
URL for this article:
http://online.wsj.com/article/SB121703337596386675.html

USBI 1st Quarter 2008 Financial statements

Financial Statements - 1st Quarter 2008

USBI's "Safe and Secure" rating

The link below http://www.bankrate.com/brm/safesound/commmm.asp?fedid=259330 gives the Thomasville bank's rating and a report on its condition.

"Safe and Sound" Rating from Bankrate.com - what it means

The link below explains how to interpret a bank's "Safe and Sound" rating. http://www.bankrate.com/brm/safesound/ss_home.asp

Information at the WSJ

http://online.wsj.com/quotes/main.html?mod=2_0450&symbol=USBI&news-symbol=USBI

FDIC information on USBI

Click on http://www4.fdic.gov/IDASP/main.asp and for the FDIC certificate number enter 17077.

USBI shareholders vote down proposal

USBI shareholders vote down proposal
Sons of original director sought approval to seek merger
Wednesday, May 14, 2008
By KAIJA WILKINSON
Business Reporter

THOMASVILLE Despite impassioned arguments from sibling shareholders who sought approval for United Security Bancshares Inc. to aggressively seek a merger with a "well-managed" company and establish stricter guidelines for electing directors, both measures were voted down during the company's annual meeting Tuesday.

About 100 people, mostly shareholders, attended the meeting, held at Alabama Southern Community College.

Shareholders also approved the election of 12 directors, who will hold office until next year's annual meeting.

J. Patrick Davidson and William R. Davidson, both sons of James Samuel Davidson, an original director of USBI's predecessor bank, proposed the two failed measures.

The brothers cited problems with management of subsidiary Acceptance Loan Corp. as the driver of their proposals. In June 2007, the company reported that loan fraud had been uncovered at Acceptance that would result in at least $3.8 million in losses. The company said the fraud happened at two branches, which it declined to identify, and was related to fraudulent loans or fraudulent handling of repossessed automobiles.

At the time, USBI President R. Terry Phillips assured shareholders that the company was taking the matter very seriously and investigating it fully. USBI has since fired an undetermined number of people and named a new president of Acceptance.

Holders of about 3.4 million shares voted against the proposal to seek a merger, with holders of more than 695,000 shares, or 16.9 percent, voting for it, said secretary Larry Sellers after the votes were tallied. That measure had been proposed by William Davidson.

Meanwhile, holders of

3.8 million shares voted against the measure to implement a new system for nominating, evaluating and electing directors, with holders of 1.2 million voting in favor. J. Patrick Davidson had proposed that measure.

The only tense moment came when moderator Hardie Kimbrough, chairman of the board, would not permit William Davidson to respond to the company's response to Davidson's merger proposal. "No, sir," Kimbrough said when Davidson asked to lodge a brief response. Kimbrough moved quickly on to the next item.

In arguing in favor of the merger proposal, William Davidson said the stewards of USBI have failed shareholders by not recognizing fraud at the subsidiary sooner, which, in turn, had a drastic effect on net income. He said that earnings were less in 2007 than they were in 1997.

Reading from USBI's proxy statement, Kimbrough countered that seeking a merger would "create uncertainty regarding Bancshares' future which could undermine confidence in Bancshares and adversely affect Bancshares' relationships with its employees, its customers and the communities it serves."

On Friday, USBI reported that its first-quarter earnings fell from $3 million in first quarter 2007 to $1.9 million, or 31 cents per diluted share. The company blamed the decline on tough economic conditions, noting that like many other financial institutions, it has felt the effects of both bad loans and a slack demand for loans in some

markets.

USBI (Nasdaq: USBI) is a Delaware corporation that operates 19 banking offices in Clarke, Choctaw, Bibb, Shelby and Tuscaloosa counties through subsidiary First United Security Bank.

Shares closed Tuesday at $17.01, down $1.06 from Monday.

This is a video explanation of how the CDARS program works. Click where it says "see for yourself."

CDARS^® is the Certificate of Deposit Account Registry Service^®. And it's the most convenient way to enjoy full FDIC insurance on deposits of up to $50 million. With CDARS, you sign one agreement with a participating local bank or other financial institution of your choice, earn one interest rate, and receive one regular statement. It's that easy.

You've worked hard for your money. Now let it work hard for you. See for yourself.

This is a Wall Street Journal article giving ways to increase your FDIC coverage

Some Options for Protecting Accounts

By JILIAN MINCER
July 22, 2008; Page D6

NEW YORK -- Money sitting unprotected in the bank doesn't have to stay that way.

The Federal Deposit Insurance Corp. guarantees deposits of less than $100,000 but says that about 37% of domestic bank deposits aren't insured.

That's because the FDIC insures checking accounts, savings accounts and certificates of deposit, but not other financial products that are now being offered at banks -- including mutual funds, annuities and life insurance. The National Credit Union Administration provides the same protection to credit-union deposits.

Evans Vestal Ward for The Wall Street Journal

Amid troubles at banks like IndyMac, consumers want more protection.

This isn't cause for panic since the vast majority of financial institutions remain sound -- despite the recent failure of IndyMac Bank and the current troubles for several other big banks. Only 90 of the nation's approximately 8,500 banks and savings associations are currently on the FDIC's list of problem banks.

Still, those wishing to take no chances have several options for making sure their bank or credit-union accounts with balances greater than $100,000 are protected.

One simple move is to open a joint account, which is insured for up to $200,000. Additional accounts could protect even more assets, says Kathleen Thompson, senior vice president of compliance at the Credit Union National Association. Ms. Thompson says that the joint account she has with her husband is protected for up to $200,000, but that adding her son to the account would add another $100,000 for a total FDIC-coverage amount of $300,000.

An individual retirement account held at a bank is insured by the FDIC for up to $250,000. That applies only if the retirement account is invested in bank products and not stocks or mutual funds.

Another option is to open a revocable trust account, which is a deposit owned by one or more persons who intend to leave the money when they die to a named beneficiary. Each owner of a trust is entitled to FDIC insurance of up to $100,000 for each designated beneficiary. This means the account can be insured for up to $300,000 if there are three named beneficiaries. The catch is that only certain beneficiaries are covered, including a spouse, child, grandchild, parent or sibling. Nieces, nephews, friends and charities don't qualify.

"Consider multiple banks and don't rely on advice from banker tellers," says Deirdre Cummings, legislative director of the consumer advocate MASSPIRG. "Instead, you need to go to the FDIC."

Ms. Cummings says if you get incorrect information from a bank employee, you're stuck, so go directly to the source -- the FDIC Web site or its staff.

Consumers also need to be aware that if their banks merge, their deposits may climb higher than the protected $100,000.

Another alternative for consumers is to use a bank that participates in the Certificate of Deposit Account Registry Service, or CDARS, which enables consumers to get up to $50 million in FDIC insurance, says Phil Battey, a spokesman for Promontory Interfinancial Network, which sells CDARS.

Currently, about 2,150 institutions, or about a quarter of all banks, offer the service. The way it works is that a customer with more than $100,000 opens a CD at a participating bank. That institution keeps $100,000, and the remaining money is distributed electronically in amounts of up to $100,000 to other CDARS banks.

If someone has $1 million, for example, the money would be divided at 11 institutions, Mr. Battey says, because they like to keep the principle and accrued interest under $100,000.

Consumers get to see what banks will receive the other deposits, and could eliminate them from the list, he says. Consumers aren't charged for the service, but the banks pay 12 and one-half basis points, or 12 and one-half cents per $100 of coverage. A basis point is one-hundredth of a percentage point.

Mr. Battey says that clients include businesses, individuals and local governments. About 15% of them are local governments. Individuals account for the largest group with an average account size of $400,000 to $500,000.

"Most consumers have faith in their banks," says Ami Shaver, senior vice president of retail banking for United Bankshares Inc., which provides CDARS to its clients, but she added coverage "does ease their concerns."

URL for this article: http://online.wsj.com/article/SB121669223511572539.html

This is a CNBC segment explaining how CDARS works.

Video - CNBC.com: "CDARS: FDIC Insurance Up to $50M
Keeping your money safe, with Alan Blinder, vice chairman of Promontory Interfinancial Network, which runs CDARS."