Two more banks were shut down by federal regulators late Friday, bringing the number of failures so far this year to 74.
The FDIC said it was appointed receiver of Dwelling House Savings and Loan Assoc. of Pittsburgh, Pennsylvania, and Colonial Bank of Montgomery, Alabama. To protect the depositors, the FDIC entered into a purchase and assumption agreement with PNC Bank, National Association, Pittsburgh, Pennsylvania, to assume all of the deposits of Dwelling House S&L Association, and Branch Banking and Trust (BB&T), Winston-Salem, North Carolina, to assume all of the deposits of Colonial Bank.
As of March 31, 2009, Dwelling House S&L Association had total assets of $13.4 million and total deposits of $13.8 million. Colonial Bank had total assets of $25 billion and total deposits of $20 billion. BB&T will purchase $22 billion in assets of Colonial Bank, the FDIC said.
The failures are expected to cost the FDIC deposit insurance fund an estimated $6.8 million and $2.8 billion, respectively.
Dwelling House S&L Assoc. is the 73rd bank to fail in the nation this year, and the first in Pennsylvania. Colonial Bank, which has 346 branches spread across Florida, Alabama, Georgia, Nevada, and Texas, is the sixth largest bank failure in U.S. history and the largest failure of this year.
“The past 18 months have been a very trying period in the financial services arena,” said FDIC Chairman Sheila Bair, in the Colonial failure release. “Our industry funded reserves have covered all losses to date. In fact, losses from today’s failures are lower than had been projected.”
The failure of Colonial Bank, which had been trying for months to raise capital from investors but drew lukewarm interest, is another major blow to the FDIC trust fund which took a $35.1 billion hit in 2008, and an additional $4.3 billion decline in the 1Q of this fiscal year.
Update: The FDIC said three more banks failed late Friday bringing year’s total to 77.
– Union Bank, National Association of Gilbert, Arizona was closed by the Office of the Comptroller of the Currency. The FDIC entered into a purchase and assumption agreement with MidFirst Bank, Oklahoma City, Oklahoma, to assume all of the deposits of Union Bank, excluding those from brokers.
As of June 12, 2009, Union Bank had $124 million in assets and $112 million in deposits. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $61 million.
Union Bank is the 75th bank to fail in the nation this year, and the second in Arizona.
– Community Bank of Arizona, Phoenix, was closed by the Arizona Department of Financial Institutions. The FDIC entered into a purchase and assumption agreement with MidFirst Bank, Oklahoma City, Oklahoma, to assume all of the deposits of Community Bank of Arizona.
As of June 30, 2009, Community Bank of Arizona had total assets of $158.5 million and total deposits of approx. $143.8 million. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $25.5 million.
Community Bank of Arizona is the 76th bank to fail in the nation this year, and the first in Arizona.
– Community Bank of Nevada, Las Vegas, Nevada, was closed today by the State Commissioner, by Order of the Nevada Financial Institutions Division. To protect the depositors, the FDIC said it created the Deposit Insurance National Bank of Las Vegas (DINB), which will remain open for approximately 30 days to allow depositors access to their insured deposits and time to open accounts at other insured institutions.
As of June 30, 2009, Community Bank of Nevada had total assets of $1.52 billion and total deposits of about $1.38 billion. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $781.5 million.
Community Bank of Nevada is the 77th bank to fail this year and the third in Nevada.
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