First Georgia Community Bank Seized by Regulators

Decade-old First Georgia Community Bank, Jackson, GA was closed late Friday by the Federal Reserve Board. Subsequently, the Federal Deposit Insurance Corporation (FDIC) was named Receiver.

From the FDIC:

First Georgia Community Bank, Jackson, Georgia, was closed today 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 United Bank, Zebulon, Georgia, to assume all of the deposits of First Georgia Community Bank.

Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers of the failed bank should continue to use their existing branches until further information is received from United Bank.

As of November 7, 2008, First Georgia Community Bank had total assets of $237.5 million and total deposits of $197.4 million. United Bank agreed to assume all the deposits for a .811 percent premium. In addition to assuming all of the failed bank’s deposits, United Bank will purchase approximately $60.6 million of assets. The FDIC will retain the remaining assets for later disposition.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $72.2 million.

First Georgia Community is the 23rd bank to fail in the U.S. this year. Like several other institutions seized by regulators in recent months, the bank expanded too aggressively, relying mostly on residential real estate to fuel loan growth. First Georgia, the state’s fourth bank to fail this year, opened in 1997.