WASHINGTON (AP) — Regulators on Friday closed two banks in
Georgia and one each in Florida and Colorado, raising to 84 the number
of U.S. banks that have failed this year.
The number of closures
has fallen sharply this year as banks have worked their way through the
bad debt accumulated in the recession. By this time last year,
regulators had shuttered 139 banks.
The Federal Deposit Insurance
Corp. seized the four banks. The largest by far was Community Banks of
Colorado, based in Greenwood, Colo., with $1.38 billion in assets and
$1.33 billion in deposits. Also shuttered were Community Capital Bank,
Jonesboro, Ga., with $181.2 million in assets and $166.2 million in
deposits; Decatur First Bank, Decatur, Ga., with $191.5 million in
assets and $179.2 million in deposits; and Old Harbor Bank, Clearwater,
Fla., with $215.9 million in assets and $217.8 million in deposits.
Community
Banks of Colorado was a state-chartered institution and under the
supervision of the Federal Reserve. The Fed appointed the FDIC receiver
of the bank after determining that it had been "critically
undercapitalized" since July 29.
The Fed said in a statement that it also consulted with Colorado’s banking commissioner.
Bank
Midwest, based in Kansas City, Mo., agreed to assume the assets and
deposits of Community Banks of Colorado. In addition, the FDIC and Bank
Midwest agreed to share losses on $714.2 of Community Banks of
Colorado’s loans and other assets.
The bank’s failure is expected to cost the deposit insurance fund $224.9 million.
State
Bank and Trust Co., based in Macon, Ga., agreed to assume the assets
and deposits of Community Capital Bank. Atlanta-based Fidelity Bank
agreed to acquire the assets and deposits of Decatur First Bank, while
1st United Bank, based in Boca Raton, Fla., is assuming the assets and
deposits of Old Harbor Bank.
In addition, the FDIC and State Bank
and Trust agreed to share losses on $141.3 million of Community Capital
Bank’s assets. The agency and Fidelity Bank are sharing losses on $111.5
million of Decatur First Bank’s assets. The FDIC and 1st United Bank
are sharing losses on $155.6 million of Old Harbor Bank’s assets.
The
failure of Community Capital Bank is expected to cost the deposit
insurance fund $62 million. The failure of Decatur First Bank is
expected to cost $32.6 million; that of Old Harbor Bank, $39.3 million.
Georgia
and Florida have been among the hardest-hit states for bank failures.
Regulators closed 16 banks in Georgia and 29 in Florida last year. The
failures of Community Capital Bank and Decatur First Bank brought to 22
the number of Georgia lenders shut down this year. Old Harbor Bank was
the 12th bank shuttered in Florida.
California and Illinois also have seen large numbers of bank failures.
In
all of 2010, regulators seized 157 banks, the most in any year since
the savings and loan crisis two decades ago. Those failures cost around
$23 billion. The FDIC has said 2010 likely was the high-water mark for
bank failures from the Great Recession.
In 2009, there were 140
bank failures that cost the insurance fund about $36 billion, a higher
price tag than in 2010 because the banks involved were bigger on
average. Twenty-five banks failed in 2008, the year the financial crisis
struck with force; only three were closed in 2007.
From 2008
through 2010, bank failures cost the fund $76.8 billion. The FDIC
expects failures from 2011 through 2015 to cost $19 billion.
The
deposit insurance fund fell into the red in 2009. With failures slowing,
the FDIC’s fund balance turned positive in the second quarter of this
year; it stood at $3.9 billion as of June 30.
Copyright 2011 The Associated Press.