Osborne’s Budget: The Country Is Basically Bankrupt

I was listening to the radio on the way into central Birmingham the other day when I heard the budget described to me as a list of things that the government is going to spend your money on. I liked this description because it made clear that the government only has any money because we agree to pay it taxes. The government needs us to pay taxes otherwise it would go broke, much as a shop goes bust if people stop buying things from it.

Think of the government and the state as a board of directors of a company. The board decides how its revenues (taxes) are spent. The directors might decide to put some extra cash into its failing healthcare business (the NHS). They might also consider offering new services to their customers, such as providing childcare to single mothers or constructing nuclear submarines to protect our borders. Hostile takeovers might also be an option: the board directors see a competitor, for example, in schooling or car manufacturing, and decides to buy it (nationalisation).

The directors also have another option to raise revenues that doesnt involve raising prices (taxes) for their customers (the citizens). The directors can decide to borrow money from the banks. In the same way that a company can get a loan from a bank to fund a new business venture, a government can do the same thing to fund a new hospital or an ill-advised invasion of a Middle Eastern country.

The loan has to be repaid at some point, usually with the extra money this new venture will bring in. If successful, more dosh will enter the coffers of the company as customers spend extra money on the new product or offering. The same goes for the government. A new hospital means healthier citizens, which means they can work more, which means they pay more taxes. Alternatively an invasion of a Middle Eastern country can mean lots of cheap oil and/or less chance of a nuclear bomb being lobbed at London. This means citizens will spend less dosh on fuel and more dosh on other things. Furthermore there will be less irradiated citizens in the new hospital due to a lower likelihood of a nuclear holocaust taking place, which means they can work more, which means they pay more taxes.

In this context, the Chancellors budget can be seen as a sort of meeting with the shareholders of the company. Osborne gives an overview of the countrys finances, an explanation of how he plans to put the finances back on track and also which ventures he plans to continue funding and which he wants to cancel.

On this basis, if the Chancellor were the chief executive of a company and the budget were a description of a companys finances, the shareholders of this company would immediately sell their stocks in the UK. The country is pretty much bankrupt. The money coming in from the taxpayer is dwindling and the money the state borrows is unsustainable. If the UK were a company, insolvency proceedings would have long been initiated.

So what did Mr Osborne say instead?

The headline offering is yet another initiative to support first and second time house buyers with taxpayer dosh. The Help to Buy scheme is the latest in a long line of ill-fated government policies to give the average man on the street the impression they can afford a house.

But hang on a minute. Was it not a property bubble in the US that caused this whole mess in the first place? In what reality does it make sense for taxpayer money to be spent supporting middle class graduates getting on the housing ladder? The logic seems to be that if more people can buy houses, more houses will be built, which will mean the economy will grow. I dont know about you, but it seems slightly bizarre to pin our hopes on a housing boom to get us out of the recession.

The other headline ideas involved buying more votes from traditionally Labour-supporting beer drinkers and drivers by taxing fuel and pints less. For the sophisticated wine drinkers of Islington, no such luck, but they tend to vote Tory or Lib Dem anyway, so less of an issue there. And those poor nicotine addicts will be squeezed a bit more as usual. The other idea is to do some more road building because apparently if we can drive faster to our destination, then that will also mean the end of the recession.

To my mind, the most astonishing proposal in the budget is to give the Bank of England to do even more than it already is. The Bank will be able to continue giving the state money until the economy starts growing again, which might be never. To return to the state as indebted country analogy, the Bank of England is a sort of credit card with no credit limit and no requirement to pay anything back. I would love to have this sort of credit card.

What Osborne in effect said in his budget is that he has no idea how to get the economy going again except by helping people buy houses they cant afford. Instead he has outsourced his responsibilities to the Bank of England, which is, lets not forget, unelected. The Bank of England will continue printing money via its quantitative easing programme until the unicorn of growth returns.

We, the shareholders, can fire our board of directors if we think theyve done a bad job. Unfortunately the alternative bosses, ie Labour, seem intent on doing exactly the same as the current board. We, the shareholders, cant fire the Bank of England. Given that the Bank of England is now in charge of getting the economy going again, this seems a bit concerning. Im not so convinced we, the shareholders, have any say in the matter anymore.

Planned Obsolescence: The Scourge of Frugality

If youre a frugal person, the concept of planned obsolescence stinks. Theres no polite way to put it. Manufacturers create things to last a short period of time, forcing you to upgrade or buy a new one at regular intervals. Its become common practice in everything from appliances to power tools to electronics. Nothing is built to last these days.

At the risk of sounding like an old person, I miss the days when things were built to last. My mother still has the same toaster that she received for her wedding in 1957. The thing is fifty-six years old and still turns out perfect toast. I, on the other hand, have been married much less than half that time and have been through seven (if Im counting correctly) toasters. And we havent always bought the cheap models, either. In an effort to get more than a year out of a toaster Ive sprung for the higher end models, only to discover that they dont last any longer than the cheap ones, on average. And we dont make that much toast.

I can remember that my parents had the same appliances for decades, and only got new ones when my mom couldnt stand the avocado green any longer. They still worked when they were shown the door; they were only eliminated because they were ugly and refused to die. On the other hand, I am shopping for a new fridge and have been told by numerous salespeople that I can realistically expect five to eight years out of the current models. Ten, if Im lucky. Thats just depressing. And expensive.

I understand why manufacturers have gone to this model. First, its cheaper for them to produce lower quality goods. Second, if you force your customers to keep buying new stuff, you increase your revenues. Lower cost to manufacture plus more purchases by the consumer equals success for the manufacturer and retailers. For the consumer, it means we pay more money. Consumers used to be able to dodge this bullet by calling a repairman to extend the life of their products, but repairs are now just as expensive as buying a new item in many cases (that, too, is by design). And thats if you can find someone trained to repair your item. Repairmen are a dying breed.

This is another reason why emergency funds now need to be bigger than they used to be. It used to be that you could figure on buying a new major appliance every fifteen to twenty years. Maybe longer. You had plenty of time to save up for those replacements. Now with everything needing replacements every five to ten years, your window for saving up has gotten much smaller. Couple that with the fact that many homes have more appliances and electronics than they used to and youre looking at a very aggressive and expensive replacement cycle. You need to save more than your parents did to cover these breakdowns and replacements.

So whats a frugal consumer to do? Unfortunately, there isnt much you can do. The manufacturers are winning this war. However, there are a few things you can do to try to turn the odds in your favor just a bit.

Take care of your stuff

Take the time and make the effort to take care of your stuff. Dont neglect your appliances. Perform routine maintenance such as cleaning the back of the refrigerator, having your air conditioner/heater tuned up and cleaned, cleaning your oven, and keeping your tools and yard equipment dry and protected from the elements. Dont abuse your items by subjecting them to overuse or using them against the directions. The better you care for your items, the longer they will last. You may be able to extend their life by a couple of years with regular maintenance and careful use.

Learn Basic Repairs

Learn some basic repair tactics. Yes, there are some things that are beyond most peoples ability to fix. However, there are many simple things that can be learned. Replacing a heating element in an oven, for example, isnt that big of a deal. Ive replaced the timer on my dishwasher without too much trouble. Replacing a frayed cord on a vacuum cleaner can be done if you have a spare cord. There are many small repair skills that are easy to learn which can extend the life of your items and help you avoid having to choose whether to repair or replace.

Look for the simple fix

When something breaks or starts acting funny, dont rush to replace it just yet. Sometimes the problem is simple to fix. Google your item and the problem (or drag out the owners manual) and see if there is a simple solution.

Do careful research

When you buy a new item, do as much research as you can on the manufacturer and the unit. Read reviews and try to find the product that has the best track record and a manufacturer that stands behind their products. Look for comprehensive warranties and reports of good customer service. You can reduce your odds of getting a crappy product by doing some research and choosing the best model (which may not be the most expensive).

Look for products that use standard parts

As an example, some products require special batteries which are not commonly available. When the battery dies, most people are forced to just buy a new one. But there may be competing products that use standard batteries. If you know how to work on cars, you might be better off choosing an older model that you can fix rather than a newer one that is computer controlled. When you buy something new or as a replacement, choose the one for which you can easily find replacement parts and that matches your repair skill set. Skip items that use proprietary parts or parts that cannot be serviced by the user.

Dont assume

Dont assume that buying the high end model will save you. High end models are just as guilty of planned obsolescence as are the lower end models. Do your research and find the best model; dont assume that the pricier stuff lasts longer.

Get off the consumer treadmill

After years of buying things like game stations, smartphones, DVD/BluRay/etc. players, and other trendy electronic products, I finally just stepped off the treadmill. I keep my lifestyle intentionally simple so there is far less junk in my life that needs constant upgrading and replacement.

Save, save, save

You know youre going to need a replacement item sooner rather than later, so never stop saving for those replacements. The minute you bring your new appliance home, start saving for its replacement. The more you can save, the more you reduce the constant shocks to your budget.


Write to the manufacturers and let them know what you think of their practices. If you encounter egregious examples of shoddy workmanship, report them to the BBB. Write reviews on consumer review sites and social networking sites. It may or may not help, but as a consumer your voice and your money are your weapons. Refuse to buy from the worst offenders and let the world know what you think of their crappy products.

Planned obsolescence is a real problem for those who want to be frugal. Couple the high failure rate of items with the fact that you can no longer find repairmen for many things and it means that youll be spending more money more often. But if you shop wisely and take care of your items, you may be able to at least extend the life of your stuff. At the very least, brace yourself for buying more replacements more often.

(Photo courtesy of Jason Tester)

Sound Off

— Sterling Heights
I think it is time for Warren residents to stop buying things that has anything to do with Campbell Ewald. If Warren isn’t good enough for them, why should they be good enough for us?

Auto insurance rate battle underway in legislature

A bill giving North Carolina automobile insurance writers the ability to seek their own individual rate changes was introduced in the General Assembly Thursday, and immediately applauded by a coalition of more than a dozen major policy writers.

Introduced in the Senate by Fayetteville Republican Wesley Meredith, the measure would give insurers the right to opt out of current rate-making process administered by the NC Rate Bureau. That’s the agency set up under a state statute that formulates a single request on behalf of the entire industry for submission to state regulators.

Under S154, individual firms could submit their own changes to Insurance Commissioner Wayne Goodwin, whom, sponsors say, would still have the power to reject any proposed hikes he considers excessive.

“North Carolina drivers will benefit from a more competitive, free-market system that reduces bureaucracy and eliminates unnecessary costs,” Meredith said in a statement on the bill.

The immediate reaction from the Department of Insurance (DOI), however, was strong opposition.

Goodwin spokeswoman Kerry Hall says the department has “major problems” with the legislation as written.

“It takes away the commissioner’s authority to stop huge increases, would permit the rates of some individual drivers to skyrocket, and would allow the companies to discriminate by age and gender.”

The fight over the measure will pit Goodwin against a group calling itself Fair NC and representing most of the major names in the auto insurance industry in the state, including The AllState Corporation (NYSE: ALL), Geico, Progressive, State Farm and 10 others.

Insurance advice for storm victims


When a viewers video of the First Day of Spring: hail storm in Brookshire hit the Fox 26 Facebook fan page, many were impressed by mother natures ability, some were concerned about a tiny bird looking for cover, and still others were worried about their personal property.

Brookshire is filling up with roof repair contractors offering free inspections to hail damaged homes, one user wrote. Then she asked the question: Can Fox 26 give any advice on what to watch for?

We took that question to Better Business Bureau here in Houston.

Get at least three competitive bids, ask for references, and just realize its not an absolute emergency, said Leah Napoliello. Be sure to know what exactly your insurance covers before a storm occurs.

Thats good advice for all types of storms and weather related damage.

This is National Flood Safety Awareness Week, and its hard to forget the flooding weve seen here in Houston.

People living in Cypress experienced it just last year, and it wasnt due to a tropical system. As hurricane season approaches, emergency managers use this week to remind homeowners of ways to keep their families and properties safe.

Its also a good time to review your insurance policy, and ask your agent questions.

What is your deductible? Does your policy cover flooding or mold damage?

What are the exclusions?

Terry McBride is with the Farmers Insurance claims department.

Take an assessment of what youve purchased over the last year, McBride said. Thats really important. The reason I bring that up is were not static. Most people are buying things. Maybe you put in a new pool or maybe your bought a trampoline for your kids? All of a sudden, your exposure begins to change.

Back to the roofing problems in Brookshire, if a contractor wants to replace the entire roof, instead of making spot repairs McBride said its important to contact your insurance agent before making an agreement.

The most important thing to remember is: am I properly covered to make sure that roof is completely replaced? Otherwise, you may have a huge out of pocket expense, he said.

Chamber nominates 21 companies for awards

A field of 21 companies have been nominated for Outstanding Business Achievement Awards by the Hamilton Chamber of Commerce.

The annual competition honours companies for longevity, ingenuity and innovation.

In the small business category (firms with up to 50 employees) the nominees are Albanese Branding, Dundas Valley Collision Centre and david premi Architect inc.

Nominated in the large business section (more than 50 employees) are FirstOntario Credit Union, Multi-Area Developments Inc. and Real Properties Limited (operating as Jackson Square).

The Ironman category is for businesses with a proven track record over 15 years. Nominated there are FELLFAB Limited, Simpson Wigle Law LLP and TradePort International Corporation, operator of Hamilton International Airport.

Three young entrepreneurs, defined as anyone under age 35, are nominated. Up for the award are Ryan Barichello of LinxSmart, Alexis Fletcher of Kabuki Spa and Skin Centre and Phi Schmidt of The Project Shaman.

Companies nominated in the communication technology section include CareGo, Sunrise Interactive Solutions Inc. (Net 6) and Weever Apps Inc.

Nominees in the not for profit sector include Mark Preece Family House, United Way of Burlington Greater Hamilton and YWCA Hamilton.

Century Awards, for companies that have survived 100 years, will go to ArcelorMittal Dofasco, the Hamilton Port Authority and National Steel Car.

The awards will be presented at a gala banquet at Carmen’s on Monday March 25. Tickets are available by contacting Whitney Simmons at the Hamilton Chamber of Commerce: w.simmons@hamiltonchamber.ca or 905- 522-1151 ext. 100.  Reception begins at 5:00 PM, with dinner at 6:00 PM.   Other event details and on-line registration for Hamilton Chamber members are available at  www.hamiltonchamber.ca.

The Hamilton Spectator

Good Auto Insurance News Released for Honda Civic Owners

The model has now become the first small car to be the recipient of the Top Safety Pick+ award.

There has been good news released for drivers of Honda Civics, both from a safety and an affordability perspective, as it has now become the first small car that has received the designation of Top Safety Pick+ from the Insurance Institute for Highway Safety (IIHS).

The IIHS also named five other vehicles to have the Top Safety Pick+ award.

In order to receive the designation of being a Top Safety Pick+ from the IIHS, a vehicle needs to undergo a series of assessments that would deem it to provide good protection for the occupants in a minimum of four out of the five tests. The fifth test must score at least an acceptable rating. The 2013 models of the vehicles also need to score as good or at least acceptable in the IIHS small overlap test, which is new this year. This rating helps drivers to know that they – and their passengers – are safer while on the road, and that they may be able to obtain more affordable auto insurance.

There have now been 18 total vehicles that have this chance to be associated with lower auto insurance premiums.

This is because those 18 vehicles have been designated Top Safety Pick+, with the Honda Civic taking the first spot among small cars. The IIHS had already named 13 of them in December for the designation in the 2013 model year.

Both the Honda Civic 2 and 4 door models have now been added to the list that may be less expensive for auto insurance due to their Top Safety Pick+ designation. Also included as of last week have been the Mazda 6, the AB Volvo XC60, and the Ford Lincoln MKZ. Each of those was a 2013 model, except for the Mazda 6, which had been redesigned for the 2014 model year, instead.

The IIHS said that both of the Civic models, as well as the Volvo XC60 had earned good ratings for the new test for small overlap protection. The Mazda 6 and the Lincoln MKZ each received an acceptable rating on that test. Either of those will play favorably with auto insurance companies.

The Insurance Guy: Auto Insurance ‘Risk Management 101’

Sprint to your filing cabinet right now and do me a favor. Pull out your current Massachusetts Auto Insurance Policy. First of all, what is filed under? A for Auto, C for Car, I for Insurance or J Junk?

Just kidding about the J File. I cant imagine anyone feeling that their auto insurance policy has anything to do with junk or trash.

Now, glance down the Coverage Selection Page until you get to Part 5, Optional Bodily Injury to Others.

In my humble opinion, the numbers that are next to those words are the most important part of your Massachusetts Auto Insurance Policy. These numbers indicate how much will be paid out if you or a household member, or even someone using your auto with your permission, injures or kills someone in an accident and is found to be legally responsible. That is a pretty serious line item in the hierarchy of line items on an insurance policy.

So, what do you have for coverage on Part 5 as we speak? If you dont have a policy in force, or you have been canceled for non-payment, or your license is suspended, or your registration has been revoked, you may not have any coverage at all. That is certainly not the time to be in an at-fault accident in which you are found to be responsible. In fact, you shouldnt be driving that car at all because it is illegal.

But, getting back to the coverage you do have. If your policy shows $20,000 per person and $40,000 per accident, that is the state minimum that Massachusetts requires. It is good news that you are following the rules of the commonwealth, but do you really think that you have enough coverage? Again, what if you or a household member is in an accident, and injures or kills another person or several persons? How quickly would the injuries (or death) amount to at least $20,000? It really wouldnt take much these days. And if you injured several people, the maximum that your policy will pay out for that accident is $40,000.

It is not my intention to scare anyone. I hardly think the words in this column would do that. I do, however, wish to make a point about how important this particular coverage is in the overall scheme of coverages on an auto policy.

Beyond the $20,000/$40,000 limit of coverage, there are many options available to choose from. Carrying $50,000/$100,000 is a move in the right direction while carrying $100,000/$300,000 makes a great deal of sense these days.

Does it cost more money to carry more coverage? Yes, it does. But it is worth taking the time to compare the additional cost of carrying appropriate coverage versus what it would cost you if were underinsured at the time of a serious accident. I am sure you will decide for yourself that it is a wise move to carry the proper limits.

Dave Bissaillon dabbles in real life while working daily as an account executive at Smith Bros.-McAndrews Insurance Agency in Adams. His occasional column will touch on insurance and other fun stuff.

Pacific Mercantile Bancorp Announces Agreement to Sell $15 Million of …

COSTA MESA, Calif., March 5, 2013 (GLOBE NEWSWIRE) — Pacific Mercantile Bancorp (Nasdaq:PMBC) announced today that it has entered into a Stock Purchase Agreement to sell up to a total of 2,222,222 shares of its common stock, at a price of $6.75 per share in cash, to Carpenter Community BancFund LP and Carpenter Community BancFund-A LP (collectively, the Carpenter Funds). The price of $6.75 per share of common stock represents a 13% premium over the $5.95 closing price of the Companys common stock on February 26, 2013, the day before the effective date of the Agreement. The net proceeds from the sale of those shares, which are expected to total approximately $14,800,000, will be contributed by the Company to a new wholly-owned asset management subsidiary, which will use those proceeds to fund the purchase of nonperforming loans and foreclosed real properties from the Companys wholly-owned banking subsidiary, Pacific Mercantile Bank. Following the purchase of those assets, the new asset management subsidiary will focus its efforts and resources principally on managing and disposing of those assets. The sale of those assets by the Bank to that subsidiary is expected to result in improvements in the Banks financial condition and future financial performance and, at the same time, will provide the Bank with additional financial resources that it plans to use to fund new loans and grow its business.

One of the responsibilities of a bank holding company is to be a source of financial strength for its banking subsidiary and the sale of the shares to the Carpenter Funds and the use of the sales proceeds to purchase non-performing assets from the Bank are being undertaken in furtherance of that responsibility, stated Raymond E. Dellerba, President and CEO of the Company. Most of the non-performing assets we will be purchasing from the Bank are assets which have proven to be the most difficult to sell or resolve due to the poor condition of the properties or the financial difficulties of the borrowers, added Mr. Dellerba.We are appreciative of the willingness of the Carpenter Funds to purchase our shares at a price above our recent market prices to enable us to purchase these assets, stated CEO Dellerba.

Consummation of the sale of the Companys common stock to the Carpenter Funds pursuant to the Stock Purchase Agreement and the use of the net proceeds from that sale of shares to purchase non-performing assets from the Bank are subject to the receipt by the Company and the Carpenter Funds of federal bank regulatory approvals, and the satisfaction of conditions customary for transactions of this nature, in each case by no later than April 15, 2013, unless that date is extended by agreement of the Company and the Carpenter Funds.

If the sale of the shares is consummated, the Carpenter Funds will own, beneficially, approximately 34% of the Companys outstanding voting shares, as compared to 28%, which they currently own.

The sale of the shares of common stock to the Carpenter Funds also will strengthen the Companys financial condition by increasing its capital and capital ratios.However, the Banks sale of non-performing assets to the Companys new asset management subsidiary will not result in changes in or improvements to the Companys consolidated financial condition or operating results, because those non-performing assets will remain on the Companys consolidated balance sheet and the costs of managing and disposing of those assets, and any losses that may be recognized on their sale or other disposition, will continue to negatively affect the Companys consolidated operating results and cash flows until the sales or dispositions of those assets are completed.

The summary of the Stock Purchase Agreement set forth above in this news release is not intended to be complete and is qualified in their entirety by reference to that Agreement, a copy of which is appended as Exhibit 10.1 to the Companys Current Report on Form8-K which the Company will be filing with the SEC by March 5, 2013.

About Pacific Mercantile Bancorp

Pacific Mercantile Bancorp is the parent holding company of Pacific Mercantile Bank, which opened for business March1, 1999. The Bank, which is an FDIC insured, California state-chartered bank and a member of the Federal Reserve System, provides a wide range of commercial banking services to businesses, business professionals and individual clients through its combination of traditional banking financial centers and comprehensive, sophisticated electronic banking services.

The Bank operates a total of seven financial centers in Southern California, four in Orange County and one each in Los Angeles and San Diego Counties, and another in the Inland Empire in San Bernardino County. The four Orange County financial centers are located, respectively, in the cities of Newport Beach, Costa Mesa (which is visible from the 405 and 73 Freeways), La Habra and San Juan Capistrano (which is our South County financial center that is visible from the Interstate 5 Freeway). Our Los Angeles County financial center is located in the city of Beverly Hills. Our San Diego financial center is located in La Jolla and our Inland Empire financial center is located in the city of Ontario (visible from the Interstate 10 Freeway). In addition, the Bank offers comprehensive banking services over its Internet Bank, which is accessible 24/7 worldwide at www.pmbank.com.

The Pacific Mercantile Bancorp logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=7241

Forward-Looking Statements

This news release contains statements regarding our expectations, beliefs and views about our future financial condition and performance and our business. Those statements, which constitute forward-looking statements within the meaning of Section27A of the Securities Act of 1933, as amended (the Securities Act), and Section21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), can be identified by the fact that they do not relate strictly to historical or current facts. Often, they include words such as believe, expect, anticipate, intend, plan, estimate, project, or words of similar meaning, or future or conditional verbs such as will, would, should, could, or may.Forward-looking statements are based on current information available to us and our assumptions about future events over which we do not have control. Moreover, our business and our markets are subject to a number of risks and uncertainties which could cause our actual financial condition or results of operating in the future to differ, possibly significantly, from our expectations as set forth in the forward-looking statements contained in this news release.

In addition to the risk of incurring loan losses, which is an inherent feature of the banking business, these risks and uncertainties include, but are not limited to, the following: the risk that the Stock Purchase Agreement and the sale of shares contemplated thereby will have to be terminated, in the event we are not able to obtain required regulatory approvals or other conditions to the consummation of the transactions contemplated by that Agreement are not satisfied; the risk that expected benefits from the transactions contemplated by the Stock Purchase Agreement, including from the sale by the Bank of nonperforming assets, may not materialize; the risk that the economic recovery in the United States, which is still relatively fragile, will be adversely affected by domestic or international economic conditions, which could cause us to incur additional loan losses and adversely affect our results of operations in the future; uncertainties and risks with respect to the effects that our compliance with the Federal Reserve Bank regulatory agreement (the FRB Agreement) and regulatory order of the California Department of Financial Institutions (the DFI Order) will have on our business and results of operations because, among other things, that Agreement and that Order impose restrictions on our operations and our ability to grow our banking franchise, and the risk of potential future supervisory action against us or the Bank by the FRB or the DFI if we are unable to meet the requirements of the FRB Agreement or the DFI Order; the risk that our earnings will be hurt by our recent exit from the wholesale mortgage lending business because that will result in a reduction, which could be significant, in our mortgage banking revenues; the risk that our interest margins and, therefore, our net interest income will be adversely affected if the economy remains weak or interest rates remain low for an extended period of time; the risk that we will not be able to manage our interest rate risks effectively, including the additional interest rate risks associated with our residential mortgage lending business, in which event our operating results could be harmed; and the prospect that government regulation of banking and other financial services organizations will increase, causing our costs of doing business to increase and restricting our ability to take advantage of business and growth opportunities.

Additional information regarding these and other risks and uncertainties to which our business is subject is contained in our Annual Report on Form 10-K that we filed with the SEC on February 27, 2012, as updated and modified by the discussion of risk factors contained in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2012 and June 30, 2012, which we filed with the SEC on May 7, 2012 and August 14, 2012, respectively. Due to these risks and uncertainties, you are cautioned not to place undue reliance on the forward-looking statements contained in this news release, which speak only as of its date, or to make predictions about our future financial performance based solely on our historical financial performance, and readers of this news release are urged to review the additional information contained in those reports.

We disclaim any obligation to update or revise any of the forward-looking statements as a result of new information, future events or otherwise, except as may be required by law or NASDAQ rules.

Nancy Gray, SEVP amp; CFO, 714-438-2500
Barbara Palermo, EVP amp; IR, 714-438-2500

Officials warn of scam involving auto insurance

Officials warn of scam involving auto insurance

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