After a holiday break, the FDIC is back in action closing banks. The first bank failure of 2014 occurred on Friday. It was a small Illinois bank, DuPage National Bank in West Chicago. Since 2010 we’ve seen fewer bank failures each year. Only 24 banks failed last year. If that trend continues into 2014, we probably won’t see more than 1 or 2 bank failures per month.
The closure of DuPage National Bank was typical. The FDIC was able to find a buyer. Republic Bank of Chicago of Oak Brook, Illinois agreed to assume all of the deposits. Consequently, no one lost any money. According to the FDIC FAQs:
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 Republic Bank of Chicago.
CD customers of DuPage National Bank will have to wait to see what happens with their rates. The acquiring bank may reduce rates on the existing CDs. However, customers will be allowed to make a penalty-free early withdrawal.
We’re still waiting for the first credit union liquidation of 2014. Last year 14 credit unions were liquidated.
Below is the summary of Friday’s bank failure:
1st Bank Failure of 2014 (1st in Illinois)
- Closed Bank: DuPage National Bank, West Chicago, IL
- FDIC Press Release
- Size: 3 branches, $61.7 million in assets and $59.6 million in deposits
- Acquiring Bank: Republic Bank of Chicago, Oak Brook, IL
- Possible Uninsured Deposits: all deposit accounts, including brokered deposits, have been assumed by Republic Bank of Chicago (FDIC Q&A)
- Rate Changes: rates will be reviewed by Republic Bank of Chicago and may be lowered (FDIC Q&A)
- Financial Ratings: 1 star at Bankrate.com, 0 star at BauerFinancial, F & Texas Ratio of 230.91% at DepositAccounts.com (see financial rating note)
Financial Ratings Notes: 0 star is lowest at BauerFinancial, 1 star is lowest at Bankrate.com and an F is lowest at DepositAccounts.com &, Texas Ratios over 100% is considered at risk. Ratings are based on September 30, 2013 data.
- FDIC list of failed banks
- Texas Ratios for banks and credit unions
- Latest FDIC info on deposit insurance
- My bank failure review posts
- Review of the 2013 bank and credit union failures
- Review of the 2012 bank and credit union failures
- Review of the 2011 bank and credit union failures
- Review of the 2010 bank and credit union failures
- 10 Lessons from the 2008 bank failures