Dedicated to Deposits: Deals, Data, and Discussion

53rd Bank Failure of 2009 - A Small Wyoming Bank

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Compared to last week when there were seven failures, it was quiet today with only one failure of a small bank. The failed bank was the Bank of Wyoming which was located in Thermopolis, a small town with a population of only just over 3,000. Not only is the town small, but the county is also small with a population of under 5,000.

The FDIC was able to find a bank to assume all deposits of Bank of Wyoming excluding some brokered deposits. All of the regular deposits were transferred even deposits over the FDIC limits.

Central Bank & Trust which will take over the deposits hasn't decided on rates, so those with CDs at Bank of Wyoming may lose their rate lock. Here's what the FDIC states:
All interest on insured deposits accrued through Friday, July 10, 2009, will be paid at your same rate. Central Bank & Trust will review rates and notify you.

You may withdraw funds from any transferred account without an early withdrawal penalty until you enter into a new deposit agreement with your new bank. Entering into a new deposit agreement can be done by either renewing your CD or making a deposit to, or a withdrawal from, your account.

This resembles most of the bank closures this year. The main concern for depositors is losing a high CD rate.

2nd Credit Union Closure of 2009

There was also a credit union closure this week that I had overlooked. According to the NCUA, it was placed into liquidation on Monday, July 6th. The credit union was Watts United Credit Union of Los Angeles, CA. It was very small with only 1,067 members and deposits of approximately $800,000. The NCUA will issue checks to individuals once they have verified the balances in share accounts. Closures like this seem to be common for failures of very small credit unions. Larger credit unions have been placed into NCUA conservatorship and then merged into healthy credit unions similar to what happened to Eastern Financial Florida.

Below is a summary of today's bank failure:

53rd Bank Failure of 2009 (1st in WY)
  • FDIC Press Release
  • Closed Bank: Bank of Wyoming
  • Location: Thermopolis, WY
  • Size: 1 office, $70 million assets, $67 million deposits
  • Possible Uninsured Deposits: All deposits transferred except some brokered deposits
  • Acquiring Bank: Central Bank & Trust, Lander, WY
  • Estimated Cost to Deposit Insurance Fund: $27 million
  • Financial Ratings: 0 star (lowest) at BauerFinancial, 1 star (lowest) at Bankrate.com
Note, the ratings at BauerFinancial and Bankrate.com are based on 3/31/09 financial data.

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