In its capacity as receiver for failed banks, the FDIC is responsible for either selling or winding down the operations of failed banks.  In the vast majority of cases, the FDIC is able to sell a failed bank to a purchaser who agrees to purchase some or all of the assets of the failed institution. In order to attract bids on failed banks, the FDIC agrees to absorb a large percentage [...]

Last week had no bank closings due to the holiday weekend.  Regulators returned to work today, closing five insolvent banks in Florida, Georgia and Michigan.  A total of 39 banks have now failed during 2011. Although the banking industry has recovered from the dark days of the financial crisis due to unprecedented government aid, the FDIC still has 884 banks on its unofficial [...]

December 10, 2010 – Paramount Bank, Farmington Hills, Michigan, a four branch community bank, was closed by the Michigan Office of Financial and Insurance Regulation, which appointed the FDIC as receiver.  Level One Bank of Farmington Hills, Michigan, entered into a purchase and assumption agreement with the FDIC under which it will assume all deposits and purchase essentially [...]

November 12, 2010 – Tifton Banking Company, Tifton, Georgia, was closed today by the Georgia Department of Banking and Finance, which appointed the FDIC as receiver. Ameris Bank, Moultrie, Georgia, acquired the failed bank from the FDIC under a purchase and assumption agreement.  Ameris Bank also acquired today another failed bank, Darby Bank & Trust Company, Vidalia, [...]

October 15, 2010 – WestBridge Bank and Trust Company, Chesterfield, Missouri, was closed today by the Missouri Division of Finance.  The FDIC was appointed as receiver and sold the bank to Midland States Bank, Effingham, Illinois, which will assume all deposits and purchase essentially all assets of the failed bank. WestBridge Bank was a small, one branch bank, owned by bank [...]

September 17, 2010 – The Peoples Bank, Winder, Georgia, was closed today by the Georgia Department of Banking and Finance and the FDIC was named as receiver. The Peoples Bank was acquired by Community & Southern Bank, Carrollton, Georgia under a purchase and assumption agreement with the FDIC.  Community & Southern will assume all deposits and purchase essentially [...]

September 17, 2010 – First Commerce Community Bank, Douglasville, Georgia, was closed today by the Georgia Department of Banking and Finance and the FDIC was named as receiver. First Commerce Bank was acquired by Community & Southern Bank, Carrollton, Georgia under a purchase and assumption agreement with the FDIC.  Community & Southern will assume all deposits [...]

September 17, 2010 – The Bank of Ellijay, Ellijay, Georgia, was closed today by the Georgia Department of Banking and Finance and the FDIC was named as receiver. The Bank of Ellijay was acquired by Community & Southern Bank, Carrollton, Georgia under a purchase and assumption agreement with the FDIC.  Community & Southern will assume all deposits and purchase essentially [...]

When a banking failure occurs, the FDIC’s goal is to protect depositors and seamlessly arrange a transfer of deposits and a sale of assets to a healthy institution.  To enhance the attractiveness of a closed bank to a potential buyer and to reduce the FDIC’s immediate cash needs,  the FDIC has made extensive use of loss-share agreements (LSA) when a failed bank’s [...]

August 20, 2010 – ShoreBank, a large and politically well connected Chicago based lender was closed by Illinois regulators who appointed the FDIC as receiver.  The failed bank was purchased from the FDIC by the Urban Partnership Bank, Chicago, Illinois, a newly-chartered institution which will wind up owning essentially all of the deposits and assets of failed ShoreBank.  [...]