8 More Banks Close; Already 50 This Year
If someone has aspirations of completely nationalizing the financial sector, times are looking good. Hmmmm…
/begin sarcasm
Oh well, it’s a good thing the economy is recovering and the worst is behind us.
/end sarcasm
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From Yahoo News
WASHINGTON (AP) — Regulators on Friday shut down eight banks — three in Florida, two in California, and one each in Massachusetts, Michigan and Washington — putting the number of U.S. bank failures this year at 50.
The Federal Deposit Insurance Corp. took over the three Florida banks: Riverside National Bank in Fort Pierce, with $3.4 billion in assets; First Federal Bank of North Florida in Palatka, with $393.3 million in assets; and AmericanFirst Bank in Clermont, with assets of $90.5 million.
TD Bank Financial Group, a division of Canada’s TD Bank, agreed to acquire the deposits and nearly all the assets of the three Florida banks.
The FDIC also seized Innovative Bank, based in Oakland, Calif., with about $269 million in assets; Tamalpais Bank of San Rafael, Calif., with about $629 million in assets; City Bank, based in Lynnwood, Wash., with about $1.1 billion in assets; Butler Bank in Lowell, Mass., with $268 million in assets; and Lakeside Community Bank in Sterling Heights, Mich., with $53 million in assets.
Los Angeles-based Center Bank agreed to assume the assets and deposits of Innovative Bank. San Francisco-based Union Bank is acquiring the assets and deposits of Tamalpais Bank. Whidbey Island Bank, based in Coupeville, Wash., is assuming the deposits of City Bank and $704.1 million of its assets. People’s United Bank in Bridgeport, Conn., agreed to assume the assets and deposits of Butler Bank.
The FDIC couldn’t find a buyer for Lakeside Community Bank. First Michigan Bank in Troy, Mich., will take over the failed bank’s direct deposit operations for federal payments, such as Social Security and veterans’ benefits.
The failure of Riverside National Bank is expected to cost the deposit insurance fund $491.8 million. For the other banks, the estimated costs: First Federal Bank of North Florida, $6 million; AmericanFirst Bank, $10.5 million; Innovative Bank, $37.8 million; Tamalpais Bank, $81.1 million; City Bank, $323.4 million; Butler Bank, $22.9 million; and Lakeside Community Bank, $11.2 million.
Depositors’ money is insured up to $250,000 per account by the FDIC, which is backed by the government.
Last year, 140 banks failed in the U.S. The failures last year cost the FDIC’s insurance fund more than $30 billion.
Twenty-five banks failed in 2008 and three in 2007.
FDIC Chairman Sheila Bair has predicted that the number of bank failures will peak this year and be slightly more than in 2009.
Paradis reported from New York.
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