By Mark Huffman
ConsumerAffairs.com
November 14, 2009
The Federal Deposit Insurance Corporation has shut down another three U.S. banks, bringing the toll for the year to 123. The latest casualties are in California and Florida, two states hard hit by the real estate crises.
Federal and state officials closed Pacific Coast National Bank, San Clemente, California, and brokered a deal with Sunwest Bank, Tustin, California, to assume all of the deposits. As of August 31, 2009, Pacific Coast National Bank had total assets of $134.4 million and total deposits of approximately $130.9 million. Sunwest Bank did not pay a premium to assume all of the deposits of Pacific Coast National Bank. In addition to assuming all of the deposits of the failed bank, Sunwest Bank agreed to purchase essentially all of the assets.
In Florida, officials closed Orion Bank, Naples, Florida, and entered into a purchase and assumption agreement with IBERIABANK, Lafayette, Louisiana, to assume all of the deposits of Orion Bank. As of October 31, 2009, Orion Bank had total assets of $2.7 billion and total deposits of approximately $2.1 billion. The FDIC accepted a 1.5 percent discount from IBERIABANK on the deposits of the failed bank.
The FDIC and IBERIABANK entered into a loss-share transaction on approximately $1.9 billion of Orion Bank's assets. IBERIABANK will share in the losses on the asset pools covered under the loss-share agreement.
IBERIABANK also agreed to purchase the assets of Century Bank, Federal Savings Bank, Sarasota, Florida, after it was closed Friday. As of October 31, 2009, Century Bank, FSB had total assets of $728 million and total deposits of approximately $631 million.
The FDIC accepted a 1.5 percent discount on the deposits of the failed bank from IBERIABANK. In addition to assuming all of the deposits of the failed bank, IBERIABANK agreed to purchase $706 million of the failed bank's assets. The FDIC retained the remaining assets for later disposition.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) for this week's bank closing will be approximately $986 million.
