The bank's failure is a big issue in Giannoulias' campaign against Congressman Mark Kirk for the U.S. Senate.
The FDIC is deciding which bank will take over Broadway's operation. The transition typically happens after the last customer leaves on a Friday afternoon. In Broadway Bank's case, ABC7 has learned efforts are underway to keep it from becoming political theater.
Customers' accounts are safe, but within the next week Broadway Bank is expected to be no more.
"The little bit we've learned about how the bank got into trouble seems pretty preposterous. I've definitely limited the amount of banking we do here and using my credit union more," said Geri Foley, Broadway Bank customer.
The FDIC takeover and sale of Broadway's assets is similar to countless other banks. MB Financial picked up Corus. Chase snatched Washington Mutual. What's different is that Alexi Giannoulias cited as his experience to become state treasurer, his few years as the bank's senior loan officer.
"Broadway very simply lent heavily in construction and development real estate lending and other banks that did the same thing find themselves in the same dire straights that Broadway is in," said Justin Barr, Loan Workout Advisers.
Despite his title as a senior vice president with the bank, Giannoulias insists he didn't play a direct role in controversial loans to two felons or the bulk of Broadway's other bad loans.
"Less than 9 percent of the loans that are currently non-performing were even around when I was there. I still take responsibility for that 8.5 percent," Giannoulias told ABC7 on March 3.
In the last few years, 140 banks have failed nationwide, 25 here in Illinois.
"Should they have known better? You could ask the same question of the bank regulatory authorities that were supposed to be watching, not just Broadway but this entire market," said Barr.
Experts say Broadway's failure could set up the Giannoulias family for a tax refund, but it won't cover the emotional loss of having your father's business go belly up, let alone the political toll for the once rising star.
"I've stuck with the bank because we have a business in the neighborhood and we try to do our business locally. We are concerned. It does make a difference," said Geri Foley, Broadway Bank customer.
Experts expect Broadway's branches and assets will be bundled with several other failing banks in the area and sold off to a healthier, bigger bank. There's a general feeling that small businesses lose when community banks fail because that's who they often turn to for loans.
Spokespeople for Broadway Bank and Giannoulias declined to talk to ABC7 on the record Thursday.
