Two Banks in Illinois and Washington State Closed by Regulators

The last FDIC press release on Fridays have typically been a bank closure press release. However, today's last FDIC press release was on the downgrade of the U.S. credit rating from AAA to AA+. The press release is intended to inform banks that this change won't affect risk weights for Treasury securities for risk-based capital purposes.

Before the credit rating press release, the FDIC issued press releases on two bank closures, one in Illinois and one in Washington. This brings the total number of 2011 bank failures to 63. At this time last year there had been 109 bank failures.

For both bank failures the FDIC arranged for other banks to assume all regular deposits of the failed banks. One interesting thing to note about the Washington State bank failure is that the acquiring bank decided not to keep all of the failed bank's 20 branches. Only 8 of the 20 branches will be kept and remain open.

Since I wasn't able to post on last week's bank failures, I included those July 29th bank failures in the summary below. These are shown above today's two bank failures. There have been no credit union liquidations or conservatorships since July 22nd.

59th Bank Failure of 2011 (1st in Virginia) (July 29th)

• FDIC Press Release
• Closed Bank: Virginia Business Bank, Richmond, VA
• Size: 1 branch, $95.8 million in assets, $85.0 million in deposits
• Acquiring Bank: Xenith Bank, Richmond, VA
• Possible Uninsured Deposits: All deposit accounts, including brokered deposits, have been assumed by Xenith Bank
• Rate Changes: Current rates will be reviewed by the new bank and may be lowered (FDIC Q&A)
• Estimated Cost to Deposit Insurance Fund: $17.3 million
• Enforcement Action: Federal Reserve 8/20/09 Written Agreement, Federal Reserve 1/24/11 PCA

• FDIC Press Release
• Closed Bank: BankMeridian, N.A., Columbia, SC
• Size: 3 branches, $239.8 million in assets, $215.5 million in deposits
• Acquiring Bank: SCBT, N.A., Orangeburg, SC
• Possible Uninsured Deposits: All deposit accounts, excluding the Cede & Co. deposits have been assumed by SCBT, N.A.
• Rate Changes: Current rates will be reviewed by the new bank and may be lowered (FDIC Q&A)
• Estimated Cost to Deposit Insurance Fund: $65.4 million
• Enforcement Action: OCC 9/16/10 Consent Order

• FDIC Press Release
• Closed Bank: Integra Bank, N.A., Evansville, IN
• Size: 52 branches, $2.2 billion in assets, $1.9 billion in deposits
• Acquiring Bank: Old National Bank, Evansville, IN
• Possible Uninsured Deposits: All deposit accounts, excluding any Cede & Co. deposits, have been assumed by Old National Bank
• Rate Changes: Current rates will be reviewed by the new bank and may be lowered (FDIC Q&A)
• Estimated Cost to Deposit Insurance Fund: $170.7 million
• Enforcement Action: OCC 5/20/09 Formal Agreement

62nd Bank Failure of 2011 (6th in Illinois) (Aug 5th)

• FDIC Press Release
• Closed Bank: Bank of Shorewood, Shorewood, IL
• Size: 3 branches, $110.7 million in assets, $104.0 million in deposits
• Acquiring Bank: Heartland Bank and Trust Company, Bloomington, IL
• Possible Uninsured Deposits: All deposit accounts, including brokered deposits, have been assumed by Heartland Bank and Trust Company
• Rate Changes: Current rates will be reviewed by the new bank and may be lowered (FDIC Q&A)
• Estimated Cost to Deposit Insurance Fund: $25.6 million
• Enforcement Action: FDIC 11/14/09 Consent Order, FDIC 3/25/11 PCA
• Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, 1 star & Texas Ratio of 159.70% at DepositAccounts.com (see financial rating note)

63rd Bank Failure of 2011 (3rd in Washington) (Aug 5th)

• FDIC Press Release
• Closed Bank: Bank of Whitman, Colfax, WA
• Size: 20 branches, $548.6 million in assets, $515.7 million in deposits
• Acquiring Bank: Columbia State Bank, Tacoma, WA
• Possible Uninsured Deposits: All deposit accounts, excluding the Cede & Co. deposits, have been assumed by Columbia State Bank
• Rate Changes: Current rates will be reviewed by the new bank and may be lowered (FDIC Q&A)
• Estimated Cost to Deposit Insurance Fund: $134.8 million
• Enforcement Action: Federal Reserve 7/8/10 Written Agreement, Federal Reserve 2/9/11 PCA
• Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, 1 star & Texas Ratio of 158.55% at DepositAccounts.com (see financial rating note)

Financial Ratings Notes: 0 star is lowest at BauerFinancial, 1 star is lowest at Bankrate.com & DepositAccounts.com, Texas Ratios over 100% is considered at risk. Ratings are based on March 2011 data.

References:

• FDIC list of failed banks
• NCUA list of closed credit unions
• Texas Ratios for banks and credit unions
• Latest FDIC info on deposit insurance
• My bank failure review posts
• Review of the 2010 bank and credit union failures
• 10 Lessons from the 2008 bank failures