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Overheard at Alliance Bancorp of Oakbrook – “So long suckers! Hello chapter 7!”

3 subsidiaries of ARH Mortgage Inc. of Brisbane, California filed Chapter 7 in Wilmington, DE including Alliance Bancorp Inc. of Oakbrook, Ill. According to an SEC prospectus filed in May they company and its subsidiaries originated $2.6 Billion in loans.

In a message posted on the company’s Web site, Alliance Bancorp’s Chief Executive Officer and President Lisa Duehring said the lender had “put up a valiant fight” but that “the latest market was more than we were able to overcome. We have exhausted our resources and do not have the means to move forward.”

In the Q4 of 2006 Alliance Bancorp experienced an increase in early payment defaults resulting in increased demands to repurchase the bad loans. Losses resulted when the loans were repurchased at face value and could not be placed again, or only placed at a steep discount.

According to news reports and Alliance Bancorp’s website the company ceased operations July 13 and filed a Chapter 7 petition with the U.S. Bankruptcy Court in Wilmington, DE.

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