Federal regulators seized control of BankFirst, Sioux Falls of South Dakota, bringing the year’s total to 55.
BankFirst, Sioux Falls, South Dakota, was closed today by the South Dakota Division of Banking, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Alerus Financial, National Association, Grand Forks, North Dakota, to assume all of the deposits of BankFirst.
As of April 30, 2009, BankFirst had total assets of $275 million and total deposits of approximately $254 million. In addition to assuming all of the deposits of the failed bank, Alerus Financial, N.A. will acquire $72 million in assets, comprised of cash, securities and loans secured by deposits.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $91 million. Alerus Financial, National Association’s acquisition of all the deposits was the “least costly” resolution for the FDIC’s DIF compared to alternatives.
Unfortunately, many more banks will collapse before the financial crisis is over.