The National Bank of Commerce in Berkeley, Illinois is the first bank failure of 2009. The bank was closed Friday by the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corp. was named receiver.
To protect the depositors, the FDIC entered into a purchase and assumption agreement with Republic Bank of Chicago, Oak Brook, Illinois, to assume all of the deposits of National Bank of Commerce.
As of January 7, 2009, National Commerce Bank had total assets of $430.9 million and total deposits of $402.1 million. In addition to assuming all of the failed bank’s deposits, Republic Bank agreed to purchase approximately $366.6 million in assets at a discount of $44.9 million. The FDIC will retain the remaining assets for later disposition.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $97.1 million. Republic Bank’s acquisition of all deposits was the “least costly” resolution for the FDIC’s Deposit Insurance Fund compared to alternatives.
The last bank to be closed in Illinois was Meridian Bank in Eldred last October. In 2008, 25 banks closed, compared to only three in 2007.