Millennium Bank, Sterling, Virginia, was close today by the Office of the Comptroller. The failed bank which was established in 1999 was placed into receivership with the FDIC. To protect depositors the FDIC sold the failed bank to WashingtonFirst Bank, Reston, VA. Under the terms of the purchase and assumption agreement with the FDIC, WashingtonFirst assumed all of the deposits of Millennium Bank and agreed to purchase almost all of the failed bank’s assets.
Established at the dawn of the greatest real estate boom in history, Millennium Bank rapidly grew its business and at December 31, 2006, the bank had total assets of almost $583 million. With the onset of the financial crisis in 2008 many of the loans in Millennium’s portfolio began to default and the bank was never able to recover from the bad lending decisions made in boom times. By year end 2012, Millennium Bank’s troubled asset ratio rose to almost 200%, a level from which recovery is virtually impossible.
According to the bank’s website, Millennium Bank’s goal was to provide “total financial solutions for your personal and business needs.” The Bank also provided services related to brokerage, leasing, insurance and consumer real estate. Millennium Bank served the local community and its Board of Directors were local business people.
At the time of closing Millennium Bank had two branches which will reopen as branches of WashingtonFirst and all depositors of the failed bank will automatically become customers of Washington First with uninterrupted FDIC deposit insurance coverage up to the applicable limits. Over the weekend, depositors of Millennium Bank will continue to have access to their money through the use of ATMs, checking accounts, and debit cards.
At December 31, 2013, Millennium Bank had total deposits of $121.7 and total assets of $130.3 million. WashingtonFirst Bank agreed to pay the FDIC a 1% premium for the deposits of Millennium Bank.
Millennium Bankshares Corporation is the bank holding company for Millennium Bank and its stockholders have seen one of the greatest bank stock busts in history as the stock collapsed from over $500 per share in 2006 to $0.51 at today’s close.
The cost to the FDIC deposit insurance fund for the collapse of Millennium Bank is $7.7 million. Millennium Bank is the fourth bank failure of the year and the first in Virginia. The last bank to fail in Virginia was the Bank of the Commonwealth, Norfolk, VA, in September 2011.