It's a secret world

It's often the case that when disasters occur, important details are revealed to the public for the first time. You'll agree that these are disastrous times for the banking industry and we have learned much about the way banks work over the past few months in particular.

Today's juicy little detail is about loans to insiders, i.e., executives, directors and the directors' companies. Now there is no law that says a bank cannot loan money to these insiders. However, there is a regulation that says the bank does not have to reveal the details, who got what why. It would be nice to know this information when we own part of the banks. For example, Bank of America doubled its loans to insiders in the third quarter of 2008, when the debacle began to escalate in intensity. You have to wonder why this occurred when credit for your company was drying up, not expanding. One of the reasons for the S&L failure of the late last century was loans to insiders. Can it happen now?

Here is a list of the banks who lent the most to insiders. See any familiar names?

JPMorgan Chase, New York, $1.48 billion

Wachovia, Charlotte, N.C., $747 million

M&I Marshall & Ilsley, Milwaukee, $644.4 million

Bank of America, Charlotte, $624.2 million

Northern Trust, Chicago, $523.5 million

Union Bank, San Francisco, $499.3 million

BB&T, Winston-Salem, N.C., $493.8 million

Commerce Bank, Kansas City, Mo., $467.9 million

Regions Bank, Birmingham, Ala., $444.3 million

Comerica Bank, Dallas, $391.5 million