Recession claims 4 more banks in the US; 2008 tally reaches 29
25 Apr 2009
The US Federal Deposit Insurance Corporation (FDIC) has closed four more banks and one credit union, taking the number of failures this year to 29. That is up from 25 banks in all of 2008 and three in 2007.
The latest in the list are Eastern Financial Florida Credit Union, First Bank of Beverly Hills, Michigan Heritage Bank, First Bank of Idaho and American Southern Bank.
''The FDIC has been consistent in our public statements that there will be an increase in activity in bank failures over the course of this year and the announcements tonight reflect that," FDIC spokesman Andrew Gray said.
"There's been little to no disruption for insured depositors," Gray said.
Eastern Financial Florida Credit Union, headquartered in Miramar, Florida, had about $1.6 billion in assets and about 200,000 members. Space Coast Credit Union of Melbourne, Florida, will temporarily manage operations. The National Credit Union Administration was appointed conservator by the Florida Office of Financial Regulations.
First Bank of Beverly Hills in Calabasas, California, had about $1.5 billion in assets and $1 billion in deposits. FDIC said it had approved the payout of insured deposits. The California Department of Financial Institutions appointed the FDIC as the receiver.
The failure of First Bank of Beverly Hills is expected to cost the FDIC insurance fund about $394 million.
As of 31 December 2008, First Bank of Idaho in Ketchum had total assets of approximately $488.9 million and total deposits of $374 million. The failure is expected to cost the FDIC insurance fund about $191.2 million.
The US Bank, Minneapolis, Minnesota, would assume all of the deposits of First Bank of Idaho, excluding $112.8 million in brokered deposits held by First Bank of Idaho, which had seven offices in Idaho and Wyoming.
As of 31 December 2008, Michigan Heritage Bank of Farmington Hills, Michigan had about $184.6 million in assets and $151.7 million in deposits. FDIC said Level One Bank of Farmington Hills would assume the closed bank's deposits. Level One paid a premium of 1.16 per cent to acquire the deposits of Michigan Heritage.
In addition to acquiring $101.7 million of the failed bank's deposits, Level One agreed to purchase approximately $46.1 million in assets. The FDIC will retain any remaining assets for later disposition.
The failure of Michigan Heritage Bank is expected to cost the FDIC insurance fund about $71.3 million.
American Southern Bank of Kennesaw, Georgia's deposits will be assumed by Bank of North Georgia of Alpharetta, Georgia. American Southern had about $112.3 million in total assets and total deposits of $104.3 million. The failure is expected to cost the FDIC insurance fund $41.9 million.
Bank of North Georgia paid a premium of 0.003 per cent to acquire the deposits of American Southern Bank.
Customers of both banks can use their existing branches until Bank of North Georgia can fully integrate the deposit records of American Southern Bank, FDIC said.
The FDIC will insure up to $250,000 per account through 2009 and in individual retirement accounts at insured banks.
