Allah destroyed a tiny Kansas bank. Like most other bank failure announcements, they announced it on Friday night — July 28. The government never wants bank failures on the news.
As if a bank failure is a normal event. A non-event.
One thing you have to understand. Bank failures aren’t supposed to happen. In 2021 and 2022, there were ZERO bank failures.
This marks the 5th bank failure of 2023, already. So, when Heartland Tri State failed, you have to ask why.
What we know about Heartland
Bank Heartland failed, leaving $54 million unaccounted for. That was the official price tag listed by the FDIC.
Heartland wasn’t losing depositors. It didn’t have many “unrealized” losses. And it wasn’t involved in crypto. To be sure, Heartland was a small bank — $139 million in assets and $130 million in deposits. So that means $9 million aren’t accounted for. How did the FDIC get to $54 million? No body knows.
By the way, when banks say assets, that means the money the bank owes depositors plus the riba its trying to eat from borrowers.
How can a bank fail when it doesn’t have bad loans? You see, riba is a cover for all sorts of financial crimes. And this one just got busted. We just don’t know who, what, where, why. Not yet, anyways.
The official press release reported a “scam”. And nothing else. This article by Financial Times is appropriately titled “Don’t worry, it was just a “scam”. Maybe some embezzlement?
You get the picture? Banks die because of bad loans, bad reputation, or straight up fraud. Its not complicated. All it takes is a little scare.
This is part of my series on Interest Free Zone: All of the Sahih hadith related to riba, A study of weak hadith on riba, Defining riba, A detailed breakdown on why Islamic mortgages are backdoor riba, Do credit card rewards programs have riba?, Madness on options riba
Related, I have a Riba and Ruin series: Economics is to keep you a dummy, What happened to SVB?, Ward of the State, First Republic: A tale of a fake bank & a fake auction, Hush, hush, a small bank goes poof
Related, I have a Selling Islam series: Salaried Shaykhs, Can paid Shaykhs make mistakes?
References
FDIC. Dream First Bank, National Association, of Syracuse, Kansas, assumes all of the deposits of Heartland Tri-State Bank of Elkhart, Kansas. (2023, July 28). FDIC: Federal Deposit Insurance Corporation. https://www.fdic.gov/news/press-releases/2023/pr23058.html
Gandel, S. (2023, August 1). Don’t worry, it was just a “scam”. Financial Times. https://www.ft.com/content/bcd2a2b9-28da-4398-b01a-0b5c1b3423f2