Dedicated to Deposits: Deals, Data, and Discussion
About Ken Tumin About Ken Tumin - Founder and Editor

Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

Featured Savings Rates

Popular Posts

Featured Accounts

3 Small Banks in Florida and Missouri Closed by Regulators

POSTED ON BY

3 Small Banks in Florida and Missouri Closed by Regulators

The FDIC was back in action this Friday with 3 bank closures. These are the first bank failures of October, and it's the first Friday with multiple failures since July 20th. The total number of bank failures for the year is now 46. At this time last year there had been 84 bank failures.

The first two bank failures were in Florida. GulfSouth Private Bank in Destin (near Pensacola) was the first to fail. It was acquired by SmartBank in Pigeon Forge, TN. The second to fail was in the other end of the state. First East Side Savings Bank in Tamarac (near Fort Lauderdale) failed and was acquired by Stearns Bank, N.A., St. Cloud, MN.

One interesting thing to note about First East Side Savings Bank is that it used to offer a high-yield reward checking account. I had first reported on it in 2008. The bank stopped offering the account a few years ago. It seems likely that its poor financial health and orders from regulators could have killed the reward checking.

The third bank that failed was in Missouri. Excel Bank in Sedalia (about 80 miles east of Kansas City) failed and was acquired by Simmons First National Bank, Pine Bluff, AR.

All 3 banks that failed were small with the largest bank having just over $200 million in assets. The FDIC arranged for other banks to assume all deposits of the failed banks. For all 3 cases, the FDIC had the following message in its Q&A section:

No one lost any money on deposit as a result of the closure of this bank. All deposits, regardless of dollar amount, were transferred to [Acquiring Bank]

All 3 acquiring banks provided a Q&A page on their websites for the customers of the failed banks, and one of the Q&As covered what will happen to the CD rates. For all 3 cases, the acquiring banks left open the possibility that rates may be lowered. SmartBank said that all interest rates will remain the same until a notification of the change is provided. The other 2 banks didn't make that pledge so the new rates could take effect on the 20th. However, they did say that the customers would receive letters within 7 days informing them of the rate changes. In all 3 cases, the customers will be free to make an penalty-free early withdrawal.

There were no credit union liquidations this week. There was one that occurred on September 28th that I had missed. So I'm including a summary of its liquidation below. The credit union was El Paso’s Federal Credit Union in Texas. It was a small credit union with only $5 million in deposits.

Below is the summary of today's bank failures:

44th Bank Failure of 2012 (6th in Florida)

  • Closed Bank: GulfSouth Private Bank, Destin, FL
  • FDIC Press Release
  • Size: 4 branches, $159.1 million in assets and $151.1 million in deposits
  • Acquiring Bank: SmartBank, Pigeon Forge, TN
  • Possible Uninsured Deposits: all deposit accounts, including brokered deposits, have been assumed by SmartBank (FDIC Q&A)
  • Rate Changes: GulfSouth Private Bank's rates will be reviewed by SmartBank and may be lowered (FDIC Q&A)
  • Estimated Cost to Deposit Insurance Fund: $36.1 million
  • Enforcement Action: FDIC 6/23/10 Consent Order
  • Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, 1 star & Texas Ratio of 272.10% at DepositAccounts.com (see financial rating note)

45th Bank Failure of 2012 (7th in Florida)

  • Closed Bank: First East Side Savings Bank, Tamarac, FL
  • FDIC Press Release
  • Size: 1 branch, $67.2 million in assets and $65.9 million in deposits
  • Acquiring Bank: Stearns Bank, N.A., St. Cloud, MN
  • Possible Uninsured Deposits: all deposit accounts, including brokered deposits, have been assumed by Stearns Bank N.A. (FDIC Q&A)
  • Rate Changes: First East Side Savings Bank's rates will be reviewed by Stearns Bank N.A. and may be lowered (FDIC Q&A)
  • Estimated Cost to Deposit Insurance Fund: $9.1 million
  • Enforcement Action: OTS 5/20/10 C&D Order
  • Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, 1 star & Texas Ratio of 188.29% at DepositAccounts.com (see financial rating note)

46th Bank Failure of 2012 (3rd in Missouri)

  • Closed Bank: Excel Bank, Sedalia, MO
  • FDIC Press Release
  • Size: 4 branches, $200.6 million in assets and $187.4 million in deposits
  • Acquiring Bank: Simmons First National Bank, Pine Bluff, AR
  • Possible Uninsured Deposits: all deposit accounts, including brokered deposits, have been assumed by Simmons First National Bank (FDIC Q&A)
  • Rate Changes: Excel Bank's rates will be reviewed by Simmons First National Bank and may be lowered (FDIC Q&A)
  • Estimated Cost to Deposit Insurance Fund: $40.9 million
  • Enforcement Action: FDIC 3/16/10 Consent Order
  • Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, 1 star & Texas Ratio of 337.93% at DepositAccounts.com (see financial rating note)

10th Credit Union (9th Federally Insured) Liquidation of 2012 (Sep 28)

  • Liquidated CU: El Paso’s Federal Credit Union (EPFCU) of El Paso, Texas
  • NCUA Press Release
  • Size: 1,035 members and had deposits of approximately $5 million
  • Acquiring CU: Certain share accounts transferred to El Paso Area Teachers Federal Credit Union, NCUA issued checks for other accounts

Financial Ratings Notes: 0 star is lowest at BauerFinancial, 1 star is lowest at DepositAccounts.com & Bankrate.com, Texas Ratios over 100% is considered at risk. Ratings at DepositAccounts.com and BauerFinancial are based on June 30, 2012 data. Ratings at Bankrate.com are based on March 31, 2012 data.

References:



Related Posts

Comments