In the past few years, regulators have found it necessary to close hundreds of insolvent banking institutions. The FDIC, acting as receiver for failed banks, is usually able to sell most of the assets of failed banks.   Typically, the purchaser of a failed bank will acquire most or all of the assets of a failed bank in an FDIC assisted transaction.  There are occasions, however, [...]

January 21, 2010 – United Western Bank, Denver, Colorado, was closed today by the Office of Thrift Supervision, which appointed the FDIC as receiver.  The FDIC entered into a purchase and assumption agreement with First-Citizens Bank & Trust Company, Raleigh, North Carolina, to assume all deposits of the failed bank. United Western had 8 branches which will reopen on [...]

December 22, 2010 – The FDIC closed on the sale of $279 million of assets from nine failed bank receiverships.   The winning bidder of the asset pool was Cache Valley Bank, Logan, Utah, with a purchase price of 22.2% of the unpaid principal balance of $279 million.  The failed bank assets will be placed into a newly formed limited liability company (LLC) with the FDIC retaining [...]

July 30, 2010 – The FDIC today raised $400 million by selling  bonds backed by performing residential mortgages.  The mortgages are part of $39 billion in assets acquired by the FDIC from failed banks (see FDIC’s Mountain Of Failed Bank Assets Grow).  The securities are guaranteed by the FDIC and were sold at a coupon rate of 2.184% with an expected maturity date [...]

July 30, 2010 -  Five more banking institutions collapsed this week in Oregon, Washington, Florida and Georgia.  Florida now leads the nation with 20 banking failures, followed by Illinois with 12. All five of this week’s failed banks were acquired by other banking institutions under purchase and assumption agreements with the FDIC acting as receiver.  The total assets [...]

Private Investors Make Very Leveraged Bet On Asset Value Recovery The FDIC currently holds approximately $30 billion in failed bank assets from banks that have failed in the past 18 months.  The assets held by the FDIC were of such dubious quality that the FDIC was unable to entice acquiring banks to purchase them, despite the generous loss-share transactions offered by the FDIC [...]