In 2009, the biggest source of new, six-figure jobs in Orange County could end up being a banking regulator.
The Federal Deposit Insurance Corp. is in the early stages of hiring for its new office in the Irvine Spectrum, which is set to open its doors shortly to handle West Coast bank failures.
More than 200 positions advertised by the agency have yearly salaries that can start at more than $100,000.
The jobs are sure to catch the eyes of those unemployed by the mortgage and larger financial sector meltdown as they look to get a little government bailout experience on their resumes.
But competition could be fierce as hopefuls fight for jobs with current and former FDIC employees.
Irvine was chosen for the satellite office of the FDIC’s Division of Resolutions and Receiverships in part for its proximity to a big base of potential workers with financial services experience.
That said, it’s unclear how many jobs in Irvine will be filled from the public at large, rather than by existing or former FDIC employees.
In some cases, former FDIC workers from the last big period of bank and thrift failures in the late 1980s and early ’90s are being recruited to return to the regulator, said Jim Scheinkman, partner in the Costa Mesa office of Snell & Wilmer LLP.
Scheinkman was a lawyer for the FDIC in the early 1990s.
“It’s like the Blues Brothers,” he said. “Jake and Elwood are calling everyone, saying they’re getting the band back together.”
Former FDIC employees during the agency’s last busy period since have moved on to commercial banking, real estate investment trusts or as intermediaries for financial and real estate deals, Scheinkman said.
Employment at the FDIC “is like a sponge,” Scheinkman said.
“When times are tough, it will absorb a lot of people,” he said. “But when it turns,and it will,it will dry up. It’s a nice place to stay to weather the storm.”
Most of the FDIC jobs are temporary, with the expectation of two-year terms for most of the Irvine positions. Those jobs can be extended another two years depending on the state of the market, according to the FDIC’s Web site.
The regulator’s lease at the Spectrum office is for three years, with two one-year options.
Salaries
A majority of the roughly 300 open positions are being advertised with salaries one may not expect for a government position, including some as high as nearly $180,000 a year.
The steep wages being offered might strike some as excessive.
But many workers will be coming from positions in the public sector that paid better during good economic times, Scheinkman said.
And, unlike the private sector, the government positions aren’t likely to provide much in the way of bonuses, he said.
A manager in the resolutions and receiverships department can make up to $177,000, according to the FDIC’s Web site.
The most common position,a resolutions and receiverships specialist,has a salary of $75,000 to $156,000.
Technical support staff can earn close to $64,000. A secretary with enough experience stands to make up to $73,000.
Those salaries come with the expectation of a busy couple years.
The office being assembled in Irvine is the first temporary office the FDIC has opened in more than 10 years.
The agency has leased enough space,200,000 square feet,at Irvine Company’s 40 Pacifica tower to comfortably accommodate 600 workers or more.
Right now, plans are for the FDIC to hire about 125 workers during the next three months, according to officials.
More than double that amount of job postings has been listed on the FDIC’s Web site.
Finding money for hiring won’t be difficult. The FDIC had its 2009 operating budget approved at $2.24 billion on Dec. 16. That’s an increase of $1 billion from 2008.
“The cyclical nature of resolution activity requires the allocation of significant resources during heightened periods of activity,” the FDIC said in a statement.
The Irvine office will handle the fallout from bank failures in the Western U.S., including bank examinations, as well as the management and sale of assets of failed banks and thrifts when they are sold.
Through mid-December, there had been 25 bank and thrift failures in 2008, compared to three in 2007 and none from mid-2004 through 2006.
The most prominent local financial institution to fail was Newport Beach-based Downey Financial Corp. The FDIC handed over Downey’s deposits and branches to Minneapolis-based U.S. Bancorp in November.
More Failures
Next year could see even more banks and thrifts go down.
“What we’re seeing now could be just the tip of the iceberg,” Scheinkman said. “The FDIC is anticipating an explosion (of failures)” comparable to what was seen at the height of the savings and loan crisis in the late 1980s and early ’90s.”
Paul, Hastings, Janofsky & Walker LLP lawyer John Douglas, who served as general counsel to the FDIC during the peak of the savings and loan crisis, told CNNMoney.com this month that 200 or more banks could fail during the next two years.
While that’s a big spike in failures, it’s a slightly less dire prediction than Scheinkman’s.
Two hundred bank closures is a far cry from the carnage seen during the savings and loan crisis, when more than 1,000 thrifts and banks were taken over.
