OLD Media Moves

Columnist responds to criticism of banking coverage

July 23, 2008

Houston Chronicle business columnist Loren Steffy responded Wednesday to criticism of business journalists by a regulator on how the banking crisis is being covered.

Loren SteffySteffy writes, “Earlier this week, John Reich, who heads the Office of Thrift Supervision — a bureaucracy that inherited some of the FHLB’s responsibilities — deemed media coverage of the banking burnout ‘reprehensible’ in a speech to an industry conference in Florida this week.

“He blasted reporters for ‘staking out’ banks, interviewing customers and stoking public fears, saying journalists were ‘seemingly oblivious to the fact that they could drive otherwise healthy banks to fail and push troubled institutions away from potential solutions toward ruin.’

“Banks shouldn’t fail just because someone asks questions. If they do, consumers have reason to be worried, even if their deposits are insured.

“Maybe he doesn’t read his own signs. ‘Supervision’ is part of his office’s name.Yet where was the supervision of IndyMac Bank, a California thrift that failed this month, and other home lenders who were doling out loans to borrowers who didn’t deserve them?”

Read more here.

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