Bad for business

In the Sept. 4 special report Community Banking, a story on page 10 "The Dangers of Buying an Unfamiliar Business," mistakenly said OceanFirst Financial restated its earnings for all of last year to reflect a reserve for repurchasing loans from its mortgage unit. It actually revised its fourth-quarter earnings before submitting documents to the Securities and Exchange Commission. Also, the unit had been making subprime mortgages before OceanFirst acquired it in 2000.
The same story also implied that Frank Schiraldi, a Sandler O'Neill analyst, was talking specifically about OceanFirst when he said that managers failed to properly monitor their subsidiary's activities and did not understand the risks of subprime lending. Rather than a particular institution, he was talking more generally about problems banks can face with independent subsidiaries. Link