Bank Depositors May Need To Take “Prompt and Corrective Action” – Is Your Bank On This List?

The Federal Deposit Insurance Corporation, the federal agency in charge of safeguarding the nation’s bank deposits, maintains a confidential Problem Bank List. This list contains the names of institutions that have weak capital positions caused by large loan losses or operational deficiencies that usually lead to failure.  The FDIC does not publicize the list for fear of causing depositor withdrawals and bad publicity which would only serve to hasten the bank’s closing.

As of the latest report released by the FDIC there were 775 problem banks at March 31, 2010 up from 702 at the end of  2009.  Total assets held by the troubled institutions is $431.2  billion, up from $402.8 billion at the end of 2009.

Although the FDIC does not publicize their Problem Bank List, their is another way to determine if a bank is potentially unsafe and subject to closing by regulators.   The FDIC routinely releases a list of banks against which cease and desist and prompt corrective orders are issued.

A cease and desist order is issued when the FDIC has “determined that it had reason to believe that the Bank engaged in unsafe or unsound banking practices and violations of law and/or regulations.”   A prompt corrective action directive by the FDIC is a “formal action that requires an institution to take one or more specified actions to return to required minimum capital standards”.

Although, the FDIC does not publicly disclose the Problem Bank List, it is almost a certainty that most of the following banks that were issued cease and desist or prompt corrective action are on it.  Banking depositors with balances in excess of the FDIC deposit insurance limit should consider this list as “fair warning” from the FDIC and take their own “prompt corrective action” to avoid potential losses.   Given the extreme problems cited by the FDIC with the banks listed, expect many of these institutions to wind up on the Failed Bank List.

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(b), 12 U.S.C. § 1818(b)
(Cease-and-Desist)

Butte Community Bank, Chico, CA; FDIC-10-097b; Issued 5/18/10 – PDF

America California Bank, San Francisco, CA; FDIC-10-287b; Issued 5/14/10 – PDF

Tri Valley Bank, San Ramon, CA; FDIC-10-293b; Issued 5/24/10 – PDF

Sonoma Valley Bank, Sonoma, CA; FDIC-10-249b; Issued 5/18/10 – PDF

First Vietnamese American Bank, Westminster, CA; FDIC-10-248b; Issued 5/25/10 – PDF

Pine River Valley Bank, Bayfield, CO; FDIC-10-284b; Issued 5/26/10 PDF

Bank of Choice, Greeley, CO; FDIC-10-142b; Issued 5/6/10 PDF

The First Bank of Greenwich, Cos Cob, CT; FDIC-10-323b; Issued 5/17/10 PDF

Bank of Florida – Southwest, Fort Lauderdale, FL; FDIC-09-587b; Issued 5/21/10 PDF

Bank of Florida – Southwest, Naples FL; FDIC-09-586b; Issued 5/21/10 PDF

Bank of Florida – Tampa Bay, Tampa, FL; FDIC-09-588b; Issued 5/20/10 PDF

Premier Bank, Tallahassee, FL; FDIC-10-074b; Issued 5/5/10 PDF

Columbus Community Bank, Columbus, GA; FDIC-10-135b; Issued 5/25/10 PDF

South Georgia Bank, Glennville, GA; FDIC-10-165b; Issued 5/5/10 PDF

Pineland State Bank, Metter, GA; FDIC-10-211b; Issued 5/27/10 PDF

Bank of Monticello, Monticello, GA; FDIC-10-258b; Issued 5/27/10 PDF

Citizens Bank of Effingham, Springfield, GA; FDIC-10-102b; Issued 5/4/10 PDF

Builders Bank, Chicago, IL; FDIC-09-617b; Issued 5/27/10 PDF

HomeStar Bank and Financial Services, Manteno, IL; FDIC-09-580b; Issued 5/24/10 PDF

Monarch Community Bank, Coldwater, MI; FDIC-10-190b; Issued 5/6/10 PDF

Traverse City State Bank, Traverse City, MI; FDIC-10-131b; Issued 5/26/10 PDF

Eagle Community Bank, Maple Grove, MN; FDIC-10-164b; Issued 5/27/10 PDF

Glasgow Savings Bank, Glasgow, MO; FDIC-10-282b; Issued 5/26/10 PDF

Superior Bank, Hazelwood, MO; FDIC-10-229b; Issued 5/26/10 PDF

Ericson State Bank, Ericson, NE; FDIC-10-230b; Issued 5/20/10 PDF

Pisgah Community Bank, Asheville, NC; FDIC-10-280b; Issued: 5/5/10 PDF

Nova Bank, Berwyn, PA; FDIC-10-210b; Issued 5/7/10 PDF

First CornerStone Bank, King of Prussia, PA; FDIC-10-151b; Issued 5/12/10 PDF

Congaree State Bank, West Columbia, SC; FDIC-10-047b; Issued 5/14/10 PDF

The Equitable Bank, SSB, Wauwatosa, WI; FDIC-10-099b; Issued 5/14/10 PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 38, 12 U.S.C. §1831o

(Prompt Corrective Actions)

Legacy Bank, Scottsdale, AZ; FDIC-10-354PCAS; Issued 5/24/10 PDF

Butte Community Bank, Chico, CA; FDIC-10-334PCAS; Issued 5/3/10 PDF

Shoreline Bank, Shoreline, CA; FDIC-10-387PCAS; Issued 5/27/10 PDF

Ravenswood Bank, Chicago, IL; FDIC-10-286PCAS; Issued 5/6/10 PDF

SouthwestUSA Bank, Las Vegas, NV; FDIC-10-343PCAS; Issued 5/7/10 PDF

Blue Ridge Savings Bank, Inc., Asheville, NC; FDIC-10-333PCAS; Issued 5/28/10 PDF

LibertyBank, Eugene, OR; FDIC-10-361PCAS; Issued 5/14/10 PDF

Badger State Bank, Cassville, WI; FDIC-10-316PCAS; Issued 5/5/10 PDF

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