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Four banks closed (so far) 8/21/09: One costing $3B, biggest this year!

1. Guaranty Bank, Austin, TX was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with BBVA Compass, Birmingham, Alabama, to assume all of the deposits of Guaranty Bank, excluding those from brokers.

Guaranty Bank had 103 branches in Texas and 59 branches in California. Former branches of Guaranty Bank will reopen during normal banking hours starting tomorrow as branches of BBVA Compass. Depositors of Guaranty Bank will automatically become depositors of BBVA Compass. Depositors 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 should continue to use their existing branches until BBVA Compass can fully integrate the deposit records of Guaranty Bank.

As of June 30, 2009, Guaranty Bank had total assets of approximately $13 billion and total deposits of approximately $12 billion. In addition to assuming all of the deposits of the failed bank, BBVA Compass agreed to purchase $12 billion of the failed bank's assets. The FDIC will retain the remaining assets for later disposition.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $3 billion. BBVA Compass's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. Guaranty Bank is the 81st FDIC-insured institution to fail in the nation this year, and the second in Texas. The last FDIC-insured institution closed in the state was Millennium State Bank of Texas,

2. CapitalSouth Bank, Birmingham, Alabama, was closed today by the Alabama State Banking Department, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with IBERIABANK, Lafayette, Louisiana, to assume all of the deposits of CapitalSouth Bank, excluding those from brokers.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $151 million. IBERIABANK's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. CapitalSouth Bank is the 80th FDIC-insured institution to fail in the nation this year, and the second in Alabama. The last FDIC-insured institution closed in the state was Colonial Bank, Montgomery, on August 14, 2009.

3. First Coweta, Newnan, Georgia was closed today by the Georgia Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation (FDIC) as 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 Coweta, excluding those from brokers.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $48 million. United Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. First Coweta is the 79th FDIC-insured institution to fail in the nation this year, and the eighteenth in Georgia. The last FDIC-insured institution closed in the state was ebank, Atlanta, earlier today.

4. ebank, Atlanta, Georgia, was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Stearns Bank, National Association, St. Cloud, Minnesota, to assume all of the deposits of ebank.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $63 million. Stearns Bank, N.A.'s acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. ebank is the 78th FDIC-insured institution to fail in the nation this year, and the seventeenth in Georgia. The last FDIC-insured institution closed in the state was Security Bank of Jones County, Gray, on July 24, 2009.

http://www.fdic.gov/bank/individual/failed/banklist.html

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now read

now read this.....

http://www.lewrockwell.com/sardi/sardi116.html

A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Matthew 10:34 Think not that I am come to
send peace on earth: I came not to send peace,
but a sword.

SteveMT's picture

bad_:This article tells the truth that no one is discussing.

The FDIC will ask for a bailout because they are broke! More red ink with lots more to come.

Colonial Bank was actually

Colonial Bank was actually larger at $25 billion, but that is another significant regional bank.

Ah... never mind. It was an estimated cost of $2.8 billion. That is interesting because Guaranty Bank was about half the size of Colonial Bank in assets.

SteveMT's picture

Khomar: The estimated cost is the number I am using. You are...

right that the FDIC is low-balling the exposure of Colonial's losses.

Another four bite the dust!

Not good.