22 US banks which collapsed this year With slumping home prices and the worsening economic crisis taking an increasing toll on financial institutions, as many as 22 American banks have collapsed so far this year.
Collapse of such a large number of US banks, despite a $700-billion bailout package, reflects the deep turmoil of the US economy. >From 2003 to 2007, only 10 US banks were reported to have collapsed. In 2008, the figure has already touched 22, with still more than a month to go… 1.Downey Savings and Loan ===================== Newport Beach-based Downey Savings and Loan Association has become the latest victim to the acute distress in the housing market in the US. The Treasury Department agency recently boosted the minimum capital requirements for the parent, Downey Financial Corp, as the company struggled with the slumping mortgage market. Downey was hit hard by rising mortgage defaults, especially in its option adjustable-rate mortgage holdings. Option ARMs allow customers to choose a different payment option each month — including a payment that is smaller than the interest due on the loan. Defaults on these loans contributed to the forced sale or collapse of mortgage lenders Washington Mutual Inc., Wachovia Corp., IndyMac Bancorp and Countrywide Financial Corp. That led many investors to bet that Downey may be next, and they proved right. Following the bank's failure, US Bank National Association, Minneapolis, has acquired the banking operations of Downey Savings, Newport Beach, CA, in a transaction facilitated by the Federal Deposit Insurance Corporation. As of September 30, 2008, Downey Savings had total assets of $12.8 billion and total deposits of $9.7 billion. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) for Downey Savings will be $1.4 bn. 2.PFF Bank and Trust =============== Along with Downey Savings, US Bank National Association has also acquired the banking operations of PFF Bank & Trust, Pomona, CA, in a transaction facilitated by the Federal Deposit Insurance Corporation. As of September 30, 2008, PFF Bank had total assets of $3.7 billion and total deposits of $2.4 billion. 3.Security Pacific Bank ================ The Federal Deposit Insurance Corp and state regulators seized Los Angeles-based Security Pacific Bank in the first week of November. Following that move, Pacific Western Bank, also based in Los Angeles, was slated to assume all of the deposits of Security Pacific. Security Pacific had total assets of $561.1 million and total deposits of $450.1 million. Pacific Western agreed to assume all the deposits for a 2% premium, according to the FDIC. In addition to assuming all of the failed bank's deposits, Pacific Western will purchase approximately $51.8 million of assets. The FDIC will retain the remaining assets for later disposition. 4.Franklin Bank SSB ================ US bank regulators closed Franklin Bank SSB, a Houston-based community bank, on November 8, making it the third-largest and 18th US bank failure this year as slumping home prices and the worsening economic crisis take an increasing toll. Prosperity Bank of El Campo, Texas, would acquire all the deposits of Franklin Bank SSB, the Federal Deposit Insurance Corp said. As of September 30, Franklin Bank SSB had total assets of $5.1 billion and total deposits of $3.7 billion. The failure is expected to cost the FDIC's insurance fund between $1.4 billion and $1.8 billion, the regulator said. The insurance fund stood at about $45 billion at the end of June, the last time it was publicly disclosed. 5.Community Bank ============= The Community Bank, Loganville, Georgia, was closed recently by the Georgia Department of Banking and Finance, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Bank of Essex, to assume all of the deposits of the Community Bank. As of October 17, 2008, the Community Bank had total assets of $681.0 million and total deposits of $611.4 million. Bank of Essex purchased about $84.4 million of the Community Bank's assets. 6.Freedom Bank ============= US bank regulators on October 31 closed Freedom Bank in Florida, the 17th bank to fail this year as the weakening economy and falling home prices take their toll on financial institutions. Fifth Third Bank will assume the Florida bank's insured deposits, the FDIC said. Freedom Bank had total assets of $287 million and total deposits of $254 million as of October 17. The failure is expected to cost the FDIC's insurance fund between $80 million and $104 million. The insurance fund stood at about $45 billion at the end of June, which is the most updated figure publicly available. Fifth Third's acquisition of Freedom Bank's deposits was the 'least costly' alternative for the FDIC's insurance fund, the regulator said. 7.Silver State Bank ============== Silver State Bank of Henderson, Nevada, was closed by US regulators some time back, the 11th bank to collapse this year amid a surge in soured real-estate loans stemming from the worst housing slump since the Depression. Silver State, with $2 billion in assets and $1.7 billion in deposits, was shut by the Nevada Financial Institutions Division and the Federal Deposit Insurance Corp, the FDIC said. Nevada State Bank in Las Vegas will assume the deposits from Silver State, which was run by Silver State Bancorp. 8.Columbian Bank and Trust ===================== Columbian Bank and Trust Co of Topeka, Kansas, was closed by US regulators in August, the nation's ninth bank to collapse this year amid bad real-estate loans and writedowns stemming from a drop in home prices. The bank, with $752 million in assets and $622 million in total deposits, was shuttered by the Kansas state bank commissioner's office and the Federal Deposit Insurance Corp, the FDIC said. Citizens Bank and Trust will assume the failed bank's insured deposits. 9.First Priority Bank =============== Florida's six-branch First Priority Bank was shuttered August 1, in what was the eighth US bank failure of the year. SunTrust Banks agreed to take on the deposits of First Priority, the Federal Deposit Insurance Corporation said. At the end of June, First Priority had $259 million in assets and total deposits of $227 million. There were roughly $13 million in uninsured deposits held in about 840 accounts that potentially exceeded insurance limits, the FDIC estimated. SunTrust also bought about $42 million of the failed bank's assets. The FDIC sold another $14 million of First Priority's assets to LNV Corporation, a unit of Beal Bank Nevada. 10.First National Bank ================ On July 25, 2008, First National Bank of Nevada, Reno, NV, was closed by the Office of the Comptroller of the Currency (OCC). Subsequently, the Federal Deposit Insurance Corporation (FDIC) was named receiver. As of June 30, 2008, the former First National Bank of Arizona, Scottsdale, AZ, merged with First National Bank of Nevada and was included in this action. 11.ANB Financial ============= The failure of ANB Financial marked the third bank failure of the year, following the closure of Hume Bank in early March. ANB Financial had $2.1 billion in assets and $1.8 billion in total deposits as of January 31. Pulaski Bank was slated to assume $212.9 million of ANB's insured non- brokered deposits for a premium of 1.011% and would purchase $235.9 million of assets. 12.IndyMac Bank ============= Troubled mortgage lender IndyMac Bancorp Inc was taken over by federal regulators in July 2008. About 95% of the $19 billion in deposits in the bank were insured, but that leaved $1 billion that was not covered by FDIC guarantees. Agency said10,000 IndyMac customers could lose as much as half of that amount, or $500 million. The failure was expected to cost the Deposit Insurance Fund between $4 billion and $8 billion, based on preliminary estimates. 13.Washington Mutual ================= Washington Mutual Inc was closed by the US government in September in one of the largest failures of a US bank, and its banking assets were sold to JPMorgan Chase & Co for $1.9 billion. The rescue marked a historic step to clean up a US financial system littered with toxic mortgage debt. Washington Mutual, the largest US savings and loan, was closed by the federal Office of Thrift Supervision, and the Federal Deposit Insurance Corp was named receiver. The bailout came after the thrift suffered deposit outflows of $16.7 billion since September 15, the OTS said. Seattle-based Washington Mutual had about $307 billion of assets and $188 billion of deposits. 14.Alpha Bank and Trust =================== Alpha Bank and Trust of Alpharetta became the 16th bank failure of the year. FDIC was named receiver and entered into a purchase and assumption agreement with Stearns Bank of St. Cloud, Minn., to assume the insured deposits. As of September 30, Alpha Bank & Trust had total assets of $354.1 million and total deposits of $346.2 million. 15.Meridian Bank ============= Meridian Bank of Eldred was closed in October by the Illinois Department of Financial Professional Regulation-Division of Banking, and the Federal Deposit Insurance Corporation, marking the 15th bank failure of the year. FDIC approved the assumption of all the deposits of Meridian Bank by National Bank, Hillsboro, Ill. Meridian Bank had total assets of $39.2 million in total assets and $36.9 million in total deposits as of September 25. 16.Main Street Bank =============== Main Street Bank, Northville, Michigan, was in October by the Michigan Office of Financial and Insurance Regulation, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect the depositors, the FDIC approved the assumption of all the deposits of Main Street Bank, by Monroe Bank & Trust, Monroe, Michigan. Main Street Bank had total assets of $98 million in total assets and $86 million in total deposits as of October 7, 2008. 17.Ameribank =========== Ameribank Inc was shut down in September by the Office of the Thrift Supervision, making it the 12th bank this year to go under. The Northfork, West Virginia bank had total assets of $115 million and total deposits of $102 million, according to a statement on the Federal Deposit Insurance Corporation. The FDIC was named receiver and announced that it entered into purchase and assumption agreements with Pioneer Community Bank, Inc., Iaeger, West Virginia, and the Citizens Savings Bank, Martins Ferry, Ohio, to take over all of Ameribank's deposits. Ameribank had five branches located in West Virginia and three branches located in Ohio. 18.Integrity Bank ============= Integrity Bank, Alpharetta, Georgia, with $1.1 billion in total assets and $974.0 million in total deposits as of June 30, 2008, was closed by the Georgia Department of Banking and Finance, and the Federal Deposit Insurance Corporation was named receiver. The FDIC Board of Directors approved the assumption of all the deposits of Integrity Bank by Regions Bank, Birmingham, Alabama. 19.First Integrity Bank ================= On May 30, 2008, First Integrity Bank NA, Staples, MN was closed by the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. The FDIC Board of Directors approved the assumption of all the deposits of First Integrity by First International Bank and Trust, Watford City, North Dakota. In addition to assuming all of the deposits of the failed bank, First International was slated to purchase approximately $35.8 million of First Integrity's assets for a total premium of $2.03 million. The FDIC will retain approximately $18.9 million in assets for later disposition. 20.First Heritage Bank ================= On July 25 2008, First Heritage Bank N.A., Newport Beach, CA, was closed by the Office of the Comptroller of the Currency. Subsequently, the Federal Deposit Insurance Corporation (FDIC) was named receiver. As of June 30, 2008, First Heritage Bank had total assets of $254 million and total deposits of $233 million. 21.Hume Bank =========== Hume Bank, Hume, Missouri, was closed in March this year by the Commissioner of Missouri's Division of Finance, and the Federal Deposit Insurance Corporation (FDIC) was named receiver. To protect depositors, the FDIC Board of Directors approved the assumption of Hume Bank's insured deposits by Security Bank, Rich Hill, Missouri. As of December 31, 2007, Hume Bank had total assets of $18.7 million and total deposits of $13.6 million. Security Bank has agreed to assume $12.5 million of the failed bank's insured deposits for a premium of 4.26 percent. At the time of closing, Hume Bank had approximately $1.1 million in 33 deposit accounts that exceeded the federal deposit insurance limit. 22.Douglass National Bank ==================== In what was the first US bank failure this year, Federal regulators in January shuttered Douglass National Bank, an African-American-owned bank with $59 million in assets that was named in honour of the 19th- century abolitionist Frederick Douglass. The bank, which has roots stretching back to the 1940s, had struggled of late, losing $1.3 million in 2007 and $4.3 million in 2006. N.Sukumar Research Analyst www.kences1.blogspot.com --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups "Kences1" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [EMAIL PROTECTED] For more options, visit this group at http://groups.google.com/group/kences1?hl=en -~----------~----~----~----~------~----~------~--~---
