Summit Bank of Prescott, Arizona, was closed by the Arizona Department of Financial Institutions. The FDIC, acting as receiver, sold the failed bank to The Foothills Bank, Yuma, AZ.
Summit Bank was a small one branch bank. The sole branch of Summit Bank will reopen on Monday as a branch of The Foothills Bank. Depositors of Summit Bank will have access to their money over the weekend through the use of ATMs, debit cards and checks. All depositors of Summit Bank will automatically become depositors of The Foothills Bank.
At March 31, 2011, the Bank had total assets of $72.0 million and total deposits of $66.4 million. The Foothills Bank agreed to pay the FDIC a premium of 0.25% on the deposits assumed and also agreed to purchase all of the failed bank’s assets. The FDIC maintains that losses are minimized by keeping failed banking assets in the private sector.
The acquisition of Summit Bank is the first acquisition of a failed bank by The Foothills Bank.
Summit Bank becomes the nation’s 55th banking failure and the 2nd in Arizona. The estimated cost to the FDIC for the failure of Summit Bank is $11.3 million.