Mississippi Sees First Banking Failure In 2010
The Office of the Comptroller of the Currency closed First National Bank, Rosedale, MS, and appointed the FDIC as receiver. The Jefferson Bank, Fayette, MS took over First National and agreed to assume all deposits and purchase essentially all of the assets of the failed bank.
First National, established in 1907, had only one branch which will reopen on Monday as a branch of The Jefferson Bank. Customers of First National will have full access to their funds over the weekend by writing checks which will continue to be processed as usual.
Mississippi has seen very few banking failures over the years, despite the banking crisis and real estate crash. The last banking failure in Mississippi occurred 10 year ago in September 2000.
First National was a relatively small bank with only $60.4 million in assets and $63.5 million in total deposits as of March 31, 2010. The loss to the FDIC for the failure of First National was relatively insignificant at $12.6 million, especially when compared to total year to date FDIC losses of almost $71 billion.
The FDIC agreed to limit potential losses on the First National loans purchased by The Jefferson Bank by entering into a loss-share transaction on $43.5 million of First National’s assets. The FDIC has determined that the use of loss-share agreements limits losses to the taxpayer by keeping the loans in the private sector. First National Bank was the 79th FDIC insured institution to fail this year.