Milsteins spend $200M over three years to keep Emigrant Savings Bank afloat

March 09, 2010 10:05AM

Howard Milstein, head of Milstein PropertiesEmigrant Savings Bank, the struggling Milstein-owned institution and the lone major city holdout in the federal government’s Troubled Asset Relief Program, received $30 million in capital infusions from the Milsteins during the fourth quarter of 2009, according to a recent report to the Federal Reserve. The Milsteins’ fourth-quarter contribution brings the total to $200 million injected into the unprofitable bank over the past three years. With a junk credit rating and a “negative” outlook from Fitch Ratings, Emigrant continues to post losses on real estate and business lending and failed private equity investments. Its parent company, New York Private Bank & Trust Corp., posted a net $256 million loss last year and took $267 million in federal bailout money. Still, Eric Newell, a debt analyst at Fitch Ratings, said “the bank’s capital position seems to improving.” But it may need even more donations from the storied Milstein dynasty, back on the radar with the impeding sales launch of two condo towers in Batter Park City, in order to absorb future losses. Emigrant has only 3 percent of tangible capital, compared with the 5.6 percent average of its peer group. [Crain’s]