Five More U.S. Banks Shut Down by Regulators

Along with First BankAmericano in Elizabeth, N.J, which American Banking News reported on over the weekend, four more banks were closed late on Friday to close out a rugged July for the industry, bringing the total bank closings for July to 24; the most since this banking crisis began.

Now for the year, a total of 69 financial institutions have been shuttered, with these  latest five costing the Federal Deposit Insurance Corp. (FDIC) close to $1 billion in losses so far.

By far the largest bank to fall was Mutual Bank based in Harvey, Illinois, with assets worth $1.6 billion, making it the 13th financial institution to collapse in Illinois this year. Almost the entirety of its operations were sold to United Central Bank, located in Garland, Texas.

The other banks closed were Peoples Community Bank in West Chester, Ohio, with assets worth $706 million; Integrity Bank in Jupiter, Florida, with assets of $166 million; and First State Bank of Altus, Oklahoma, worth $103 million. First BankAmericano of Elizabeth, New Jersey, which we talked of over the weekend, was worth $119 million.

All of the banks closed on Friday had the majority of their assets taken over by banks in much superior position, with Mutual Bank being brought in its entirety under the umbrella of United Central with all its $1.6 billion.

As in most cases, the FDIC and United Central entered into a sharing of losses agreement concerning $1.3 billion of Mutual Bank’s assets. Costs to the FDIC are projected to be $700 million.

First Financial Bank in Hamilton, Ohio absorbed $598 million of the deposits in Peoples Community, and for the most part acquired all of the assets of the bank; buying for a premium of 1.5 percent. Share losses in this case between First National and the FDIC were $657.6 million. Estimates of costs in this deal for the FDIC are around $129 million.

With losses to the FDIC measured at around $46 million, Stonegate Bank of Fort Lauderdale took over the deposits and assets of Integrity, paying $52 million for the assets and taking over $102 million in deposits. Stonegate paid a decent 0.2 percent premium for the deal. 
 
The closure of First State Bank of Altus ended costing the FDIC about $25 million, as Herring Bank in Amarillo, Texas obsorbed $98 million of the deposits of First State Bank of Altus, and bought about $64 million in assets from the financial institution.
 
You can see more of the details of the First BankAmericano deal here.