Chapter 150: Find Out How Much Cash He Still Has

Under normal circumstances, if Black Bank were to go bankrupt, the first ones to panic would most likely be the creditors of Black Bank!

It would be completely reasonable for creditors to come knocking the moment the FDIC took over Black Bank. In such a scenario, the FDIC would naturally try to minimize its losses, perhaps by stalling on the debt to see if they could find a scapegoat to take over the bank.

But with that high-interest loan hanging over them, no one would be foolish enough to take it on. Who would want to adopt someone else's burden and pay off their debt too?

Without resolving that debt, there's a high probability that the FDIC wouldn't find a buyer and would have to swallow the loss, paying off Black Bank's debt themselves. They would then try to recoup some of their losses by increasing Black Bank's sale price, hoping for a rebound.

However, when the price is too high, no one would buy. While banks usually pay insurance premiums and comply with regulations, in times like these, they won't be kind to the FDIC. They would expect the FDIC to bleed a bit; otherwise, those insurance premiums they've been paying would seem pointless, or worse, no bank would want to see their premiums used in such a way—it's a fixed expense that lasts years or even decades.

To avoid losing this money in the long run, the only way for the FDIC to recoup their losses would be to sell Black Bank at a lower price.

As a federal deposit insurance corporation, the FDIC isn't allowed to operate a bank long-term. They are only authorized to organize the bank's original staff to continue regular operations during the bankruptcy restructuring period. This means that even if Black Bank's value plummets to almost nothing, they still have to find a way to sell it. Otherwise, they would have to shut it down completely, wasting all their efforts and investments.

When the FDIC finally has no choice but to sell Black Bank at a lower price, old Bass believed that Bass Bank could be ready for a full acquisition. Looking at it from this ideal model, young Bass didn't do wrong...

"Forget it. What's done is done. Continue with your report. What's the current situation with Black Bank?"

Thinking about this, old Bass temporarily moved past the topic and continued his inquiry.

"After securing the loan, Carter left Douglas for two months..."

"Wait, he left Douglas for two months? What was he doing?"

Old Bass was confused, and even young Bass couldn't understand Carter's actions at that time.

"He secured a large loan and then just let the money gather dust in the vault? By the way, how much did he actually borrow?"

"I'm not sure. Some people aren't willing to disclose the details. But from Atlanta Federal Savings Bank alone, he borrowed $500,000, and from another thirty or so banks, I estimate the total should not be less than $5 million, possibly exceeding $7 million. This is also why I didn't rush to act—the amount was too large for us to handle..."

"Yes, go on. He wouldn't just leave such a large sum sitting idle. Not to mention the interest, the annual value erosion due to inflation alone would be over $50,000. We struggle to make $50,000 in a year..."

Old Bass's eyes narrowed slightly, his fingers tapping lightly on the table. What could young Black be doing with such a large sum of money?

"Okay, according to the people I sent to Douglas to gather information, Carter was on a cross-country road trip during those two months. After returning, he soon used his own money to open a restaurant on Highway 23."

Seeing old Bass's sharp gaze, young Bass quickly explained:

"He used the Black family's savings to open the restaurant, unrelated to the loan. It was easy to find out; Carter's mother invited everyone to visit their family restaurant, but no one went at the time..."

"I've also looked into the restaurant. It's a franchise under a small brand focused on fried chicken, which had poor business until recently when they launched some kind of wrap."

"And then?"

Old Bass didn't care about the restaurant as long as the funds used to open it were legitimate. A single restaurant wasn't significant unless it grew into a large chain. Making a few thousand dollars a year might be tempting to an average person, but to a bank owner, even a small savings bank owner, it was insignificant.

"Then things got strange! After opening the restaurant, Carter should have no money left except for the loan, but he kept pulling out large sums for a repair shop and a gas station..."

"I paid to bribe an employee at Black Bank. According to him, after securing the interbank loan, Carter issued many loans, almost depleting the borrowed funds. Later, I suspect Carter transferred the interbank loan into his personal account; otherwise, there's no way to explain how he kept pulling out money."

"Especially after Carter returned from his trip, Black Bank started tightening its lending. Their lending contraction was even more severe than ours. If not for old Black's previous loans and Carter's continued job creation in Douglas, Douglas's unemployment crisis would have hit earlier and harder than Pearson's."

Old Bass understood his son's implication. If the interbank loan was almost entirely loaned out, the repayment within this year would be negligible. Even if Carter invested in gas stations with repaid loans, the recent acquisition of Forest Bank raised questions.

The acquisition price wasn't high, but recent news indicated that Pearson's depositors had withdrawn over $1.2 million from Forest Bank.

If Black Bank didn't have sufficient reserves, there would be signs of panic, such as urgent interbank borrowing to counter the crisis.

But so far, Black Bank showed no signs of distress and allowed withdrawals without hindrance, exuding a "we have money" attitude. This stance even weakened the rumors circulating in Pearson.

"Dad, remember they were present at the meeting. They knew we were determined to acquire Forest Bank, yet Carter still dared to proceed... This suggests either he's bluffing, pretending to be wealthy to mislead us and Pearson's depositors..."

"Or... they currently have at least $3 million in cash reserves, unafraid of our moves."

"Let's continue our actions. Also, increase the payment to our insider. We must find out exactly how much cash Carter has on hand!"