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Five Banks Fail including United Commercial Bank

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It was another busy Friday for the FDIC with 5 bank failures. The largest bank that failed was United Commercial Bank which had 63 U.S. branches and $11.2 billion in assets. East West Bank agreed to assume all deposits and branches of United Commercial Bank. One thing unique about United Commercial Bank is that it had branches in China, and consequently, the FDIC had to cooperate with the Chinese banking regulatory authority.

East West Bank not only assumed all deposits of United Commercial Bank, but it has agreed to continue to honor interest rates. The CD rates will remain the same through to maturity. I had posted on United Commercial Bank's high CD rates in July, so it's nice to see East West Bank agree to continue these rates to maturity.

Note, United Commercial Bank is not related to United Central Bank. United Central Bank has been offering competitive money market and CD rates available nationwide (see post).

For the other four bank failures today, they were typical with other banks assuming all deposits including those above the FDIC limit. Also typical, but unfortunate, the assuming banks haven't agreed to honor existing CD rates.

Below is a summary of today's bank failures:

116th Bank Failure of 2009 (21st in GA)

  • FDIC Press Release
  • Closed Bank: United Security Bank, Sparta, GA
  • Size: 2 branches, $157 million in assets, $150 million in deposits
  • Possible Uninsured Deposits: All deposits transferred, except some brokered deposits
  • Acquiring Bank: Ameris Bank, Moultrie, GA
  • Rate Changes: Ameris Bank will review rates
  • Estimated Cost to Deposit Insurance Fund: $58 million
  • Financial Ratings: 1 star (lowest) at Bankrate.com, 0 star (lowest) at BauerFinancial

117th Bank Failure of 2009 (3rd in MI)

  • FDIC Press Release
  • Closed Bank: Home Federal Savings Bank, Detroit, MI
  • Size: 2 branches, $14.9 million in assets, $12.8 million in deposits
  • Possible Uninsured Deposits: All deposits transferred
  • Acquiring Bank: Liberty Bank and Trust Company, New Orleans, LA
  • Rate Changes: Liberty Bank and Trust Company will review rates
  • Estimated Cost to Deposit Insurance Fund: $5.4 million
  • Financial Ratings: 1 star (lowest) at Bankrate.com, 0 star (lowest) at BauerFinancial

118th Bank Failure of 2009 (6th in MN)

  • FDIC Press Release
  • Closed Bank: Prosperan Bank, Oakdale, MN
  • Size: 3 branches, $199.5 million in assets, $175.6 million in deposits
  • Possible Uninsured Deposits: All deposits transferred, excluding some brokered deposits
  • Acquiring Bank: Alerus Financial, N.A., Grand Forks, ND
  • Rate Changes: Alerus Financial, N.A. will review rates
  • Estimated Cost to Deposit Insurance Fund: $60.1 million
  • Financial Ratings: 1 star (lowest) at Bankrate.com, 0 star (lowest) at BauerFinancial
  • Material Loss Review (6/2/2010)

119th Bank Failure of 2009 (3rd in MO)

  • FDIC Press Release
  • Closed Bank: Gateway Bank of St. Louis, St. Louis, MO
  • Size: 1 branch, $27.7 million in assets, $27.9 million in deposits
  • Possible Uninsured Deposits: All deposits transferred
  • Acquiring Bank: Central Bank of Kansas City, Kansas City, MO
  • Rate Changes: Central Bank will review rates
  • Estimated Cost to Deposit Insurance Fund: $9.2 million
  • Financial Ratings: 1 star (lowest) at Bankrate.com, 0 star (lowest) at BauerFinancial

120th Bank Failure of 2009 (14th in CA)

  • FDIC Press Release
  • Closed Bank: United Commercial Bank, San Francisco, CA
  • Size: 63 branches, $11.2 billion in assets, $7.5 billion in deposits
  • Possible Uninsured Deposits: All deposits transferred, except some brokered deposits
  • Acquiring Bank: East West Bank, Pasadena, CA
  • Rate Changes: East West Bank will continue to honor your interest rates
  • Estimated Cost to Deposit Insurance Fund: $1.4 billion
  • Financial Ratings: 1 star (lowest) at Bankrate.com, 0 star (lowest) at BauerFinancial

Bankrate's and BauerFinancial's ratings are based on 6/30/09 data.

References:


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Comments
4 comments.
Comment #1 by Anonymous posted on
Anonymous
Notable additions to the problem bank list as of Nov 6, 2009 include Hanmi Bank, Los Angeles, CA ($3.9 billion, ticker HAFC); Bank of Blue Valley, Overland Park, KS ($810 million, ticker BVBC.OB); and San Luis Trust Bank, FSB, San Luis Obispo, CA ($369 million, ticker SNLS..OB). In addition, another banker’s bank was added -- Independent Banker's Bank of Florida, Lake Mary, FL. The list now includes 505 banks. This was before Friday's bank failures.

The complete "unofficial" list is available for viewing at:
http://www.calculatedriskblog.com/2009/11/unofficial-problem-bank-list-grows-to.html

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Comment #2 by Sandra (anonymous) posted on
Sandra
Shorebank is also on the new list.

1
Comment #3 by Anonymous posted on
Anonymous
One wonders if there are too many banks in this country. But, then where would the accoutants work?

1