FDIC issues report on Broadway Bank closure

A new report indicates the failure of Illinois Treasurer Alexi Giannoulias' family bank in Chicago was due to a heavy concentration in real estate loans.

The Federal Deposit Insurance Corporation's inspector general's office issued the report Tuesday about Broadway Bank, which failed in April.

The report says Broadway failed because it was heavily concentrated in commercial real estate and construction loans and couldn't absorb the losses during the economic downtown.

It said the Chicago bank didn't have good credit risk management practices to manage the loans. The agency says other business strategies at the bank were also to blame.

The bank's failure was a major issue in Giannoulias' recent unsuccessful campaign for President Barack Obama's old U.S. Senate seat.

The failure cost the FDIC's Deposit Insurance Fund $390 million.