Blood in the Streets: Three More Banks Fail Friday

Banks are continuing to drop like flies as another three regional banks failed on Friday, bring the total bank failures in 2009 to 72, according to the Federal Deposit Insurance Corp.

Florida has been hit hard with bank closures recently, and two of the three regional bank closings involved were from Florida – Community National Bank in Venice and First State Bank of Sarasota. The other bank closed is Community First Bank of Prineville, Oregon.

Stearns Bank, which is based in St. Cloud, Minnesota, will take control of the assets of the two Florida Banks, while Idaho-based Home Federal Bank, of Nampa, will take control of the assets of Community First Bank in Oregon, said the FDIC.

First State Bank, which was the largest of the three, held $463 million in assets and $387 million in deposits as of May 31, andwill cost the Deposit Insurance Fund an approximate $116 million, asserted the FDIC.
The FDIC added that Community First Bank, the 2nd largest of the latest three bank failures, held assets worth $209 million and deposits held by the bank cam to around $182 million. Home Federal Bank will not only take over the deposits of the bank, but also agreed to acquire almost $200 million in assets as well.

Estimates from the FDIC are that the closure of Community First Bank will cost the Deposit Insurance Fund $45 million.

For Community National, they held assets of $97 million and deposits came in at close to $93 million as of the 30th of June. Closing them will cost the Deposit Insurance Fund $24 million.

Altogether Friday’s bank closures will drain $185 million from the FDIC’s Deposit Insurance Fund. So far in 2009, the cost of bank failures has surged to $16.5 billion, almost reaching last years total of $17.6 billion already.

Last year a total of 25 banks failed, while this year 72 banks have fallen, and we’re not close to being finished yet.