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End of World Causes Bank Failure
Numerous bad loans to a polygamist sect that believes the end of the world is nigh has caused the 99-year-old Bank of Ephraim in Utah to go under. The Fundamentalist Church of Jesus Christ of Latter-day Saints (a small Mormon sect a small splinter sect of the Mormon church, unaffiliated with the main church) was spending money like the end of the world was around the corner... because they thought the end of the world actually was around the corner. And happily funding this spending spree was the Bank of Ephraim. They approved loans for one bizarre project after another: a watermelon farm that didn't grow watermelons, a construction company that made a loss on everything it sold (materials, labor). The bank liked giving loans to the end-of-world sect because the end-of-worlders readily agreed to outrageously high interest rates (Why not? If the world ends tomorrow you don't have to pay it back). I'm trying to imagine how the interview to assess credit worthiness might have gone:
-'So you're a member of a sect whose members have sworn an oath to borrow as much money as possible before the world ends and all financial markets collapse. Is that right?'
-'That's right.'
-'Sounds good. You're approved.'
I like the understatement of Utah Banking Supervisor Jim Thomas who simply notes that the bank got in too deep with sect members who "didn't have much to lose".
Business/FinanceFuture/TimeReligion
Posted by The Curator on Wed Dec 08, 2004
I wouldn't think people who think the world is about to end would be the greatest credit risks, but then I never have figured out those ads you see all the time that say, "Easy loans! Bad credit? No credit? No problem! No references required!" Either the people behind those ads are loan sharks of the leg-breaking variety, or it's a cover for something else ... or maybe it's just a subsidiary of the Bank of Ephraim.
How did that bank last 99 years?
Posted by Big Gary C  in  Dallas, Texas  on  Wed Dec 08, 2004  at  11:25 PM
Hey, everybody, check out the link to this article. Believe it or not, it has "sponsored links" to Mormon dating services!
Just in case this story inspires you to get in on the polygamous, bad-loan action, I guess.
Posted by Big Gary C  in  Dallas, Texas  on  Wed Dec 08, 2004  at  11:33 PM
Interesting. Don't you wish you had your life savings with this bank? Their first clue should have been anyone eager to accept those high interest rates without blinking, or maybe the first several loans not being paid, what are these guys thinking? Thanks, Alex, for clarifying that this group is not affiliated with the Mormon Church in any way, they were kicked out of the Mormon Church long ago for their beliefs which strongly contradict the beliefs of the true Mormon faith.
Posted by Legbo  in  Tennessee  on  Thu Dec 09, 2004  at  12:21 PM
Gotta love those bankers hehe...
Posted by Spencer  in  Toronto  on  Tue Aug 26, 2008  at  03:57 PM
What are these Banks doing? This is ridiculous. I would have never thought I would hear something like this when it comes to banks!
Posted by hdtv antenna  in  St. Louis  on  Wed Nov 26, 2008  at  03:31 PM
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