Bank Failure Toll Reaches 123

The Federal Deposit Insurance Corporation [FDIC] closed banks in California and Louisiana on Friday, pushing U.S. bank failures to 123 this year amid continuing fallout from the worst economic crisis since the Great Depression.

– On Friday regulators closed Century Bank, FSB of Sarasota, Florida. It was the 121st FDIC-insured institution to fail in the nation this year.

The FDIC, which was named receiver and entered into a purchase and assumption agreement with IBERIABANK of Lafayette, Louisiana, to assume all of the deposits of Century Bank, FSB, said Century Bank had $728 million in assets and $631 million in deposits. The failure is expected to cost the FDIC deposit insurance fund an estimated $344 million.

The last bank closed in the state of Louisiana was Flagship National Bank, Bradenton, on November 6, 2009.

– IBERIABANK of Lafayette, Louisiana agreed to also assume all of the deposits of Orion Bank of Naples, Florida, which was closed today by the Florida Office of Financial Regulation.

The FDIC said Orion Bank had $2.7 billion in assets and $2.1 billion in deposits. The failure is expected to cost the FDIC deposit insurance fund an estimated $615 million.

Orion Bank is the 122nd FDIC-insured institution to fail in the nation this year, and the eleventh in Florida.

– Sunwest Bank of Tustin, California, agreed to assume all of the deposits of Pacific Coast National Bank of San Clemente, California.

The FDIC said Pacific Coast National Bank had $134.4 million in assets and $130.9 million in deposits. The failure is expected to cost the FDIC deposit insurance fund an estimated $27.4 million.

Pacific Coast National Bank is the 123rd bank to fail in the nation this year, and the fifteenth in California. The last FDIC-insured institution closed in the state was United Commercial Bank, San Francisco, on November 6, 2009.

The pace of bank failures has picked up significantly this year, causing a drain to the FDIC’s Deposit Insurance Fund, which turned negative at the end of the third quarter.

The agency is expecting bank failures to cost the fund about $100 billion for the next 3-4 years, and has said failures will remain elevated this year and next.