Banks in Calif., Ill., Fla., Texas are shut down

WASHINGTON (AP) — Regulators shut four banks from California to Florida on Friday, boosting to 20 the number of U.S. bank failures this year following the 140 closures last year in the worst financial climate in decades.

The Federal Deposit Insurance Corp. took over La Jolla Bank, FSB, in La Jolla, Calif. The bank had 10 branches and about $3.6 billion in assets and $2.8 billion in deposits.

Also seized was George Washington Savings Bank in Orland Park, Ill. It had four branches and about $412.8 million in assets and $397 million in deposits.

The FDIC said OneWest Bank in Pasadena, Calif., agreed to assume all deposits and essentially all assets of La Jolla Bank. The takeover is expected to cost the deposit insurance fund an estimated $882.3 million.

The FDIC and OneWest will share losses on about $3.3 billion of the failed bank's loans and other assets.

Meanwhile, FirstMerit Bank, National Association of Akron, Ohio, agreed to take over deposits at George Washington Savings Bank. FirstMerit is also taking over essentially all the assets. For George Washington, the FDIC predicts the takeover will cost the insurance fund $141.4 million

.

The loss-sharing agreement for George Washington covers $324.2 million in assets.

The other seized banks were smaller and located in Florida and Texas. They were Marco Community Bank, with a single office on Marco Island, a wealthy barrier island near Naples on Florida's Gulf Coast, and La Coste National Bank of La Coste, Texas.

Marco Community Bank had about $119.6 million in assets and $117.1 million in deposits. Mutual of Omaha Bank, a division of the big insurance company Mutual of Omaha, agreed to assume the assets and deposits of Marco Community Bank.

The failure of Marco Community Bank will cost the deposit insurance fund an estimated $38.1 million.

In addition, the FDIC and Mutual of Omaha Bank, which is based in Omaha, agreed to share losses on $104.8 million of the failed bank's loans and other assets.

Florida is among the states with the highest concentration of bank failures and where the meltdown in the real estate market brought an avalanche of soured mortgage loans. Last year saw the failure of 14 banks in the state. Also high on the list are California, Georgia and Illinois.

La Coste National Bank had a single branch and $53.9 million in assets. Deposits totaled $49.3 million.

Community National Bank of Hondo, Texas, agreed to buy the deposits and assets of La Coste National Bank — whose failure is expected to cost the insurance fund $3.7 million.

As the economy has weakened, with unemployment rising, home prices tumbling and loan defaults soaring, bank failures have accelerated and sapped billions of dollars out of the federal deposit insurance fund. It fell into the red last year.

The 140 bank failures last year were the highest annual tally since 1992, at the height of the savings and loan crisis. They cost the insurance fund more than $30 billion. There were 25 bank failures in 2008 and just three in 2007.

The FDIC expects the cost of resolving failed banks to grow to about $100 billion over the next four years.

The agency mandated banks prepay about $45 billion in premiums last year, for 2010 through 2012, to replenish the insurance fund.

Depositors' money — insured up to $250,000 per account — is not at risk, with the FDIC backed by the government. Besides the fund, the FDIC has about $21 billion in cash available in reserve to cover losses at failed banks.

Banks have been especially hurt by failed real estate loans, both residential and commercial. Banks that had lent to seemingly solid businesses are suffering losses as buildings sit vacant. As development projects collapse, builders are defaulting on their loans.

Smaller banks are more vulnerable to the losses than their bigger Wall Street counterparts, because commercial real estate makes up a larger portion of their portfolio.

If the economic recovery falters, defaults on the high-risk loans could spike. Many regional banks hold large concentrations of these loans. Banks face as much as $300 billion in losses on loans made for commercial property and development, according to a report issued last week by the Congressional Oversight Panel, which monitors the government's efforts to stabilize the financial system.

The report said the defaults could crimp lending and cause the eviction of families from rental properties. Bank failures also could contribute to job losses and hurt the economic recovery

.

President Barack Obama recently promoted a $30 billion plan to provide money to community banks if they boost lending to small businesses. The program, which must be approved by Congress, would use money repaid by banks to the $700 billion federal bailout fund.

Hundreds of banks, including major Wall Street institutions, received taxpayer support through that politically unpopular rescue program, enacted by Congress in October 2008 at the height of the financial crisis.

Views: 27

Comment

You need to be a member of 12160 Social Network to add comments!

Join 12160 Social Network

Comment by Jeff on February 21, 2010 at 8:38pm
Agreed
Comment by 7R33SandR0P3S on February 21, 2010 at 8:03pm
The plan orchestrated for the same objective.
Comment by Jeff on February 21, 2010 at 7:42pm
It really is a repeat on a smaller scale since we've grown so much larger.
Comment by 7R33SandR0P3S on February 21, 2010 at 7:10pm
a repeat of 1929 - 33
Comment by Jeff on February 21, 2010 at 6:03pm
This is, today, nothing more then normal. Many more banks will fail as we progress through the commercial real estate failures. It's nothing to worry about and it means nothing.

It's a consolidation of wealth allowing larger banks to consume the smaller ones and no one loses money, we just lose as a result of the extraordinary consolidation of wealth. To look at it any other way is foolish. FEMA camps were developed for a specific purpose and that's if our neighbor to the south where 1000s of people have been killed in the past two years over drug wars, supports a huge influx of immigrants fleeing the collapse of the country. They aren't for Americans. That's disinformation.
Comment by illuminated-dj on February 21, 2010 at 3:48pm
All part of modernization :/ .what my sister tried to tell me in her state of extreme flouridation and denial when i tried to point out job losses to her.another one for the fema camp please!

"Destroying the New World Order"

TOP CONTENT THIS WEEK

THANK YOU FOR SUPPORTING THE SITE!

mobile page

12160.info/m

12160 Administrators

 

Latest Activity

cheeki kea replied to cheeki kea's discussion Tartaria
"Greetings to you John, You're right and it didn't take long for those manuals to totally…"
54 minutes ago
Doc Vega posted a blog post

The Many Keys to Deadly Secrecy in our Government

We now know thanks to the legislation of FOIA access to federal documents and evidence and the…See More
4 hours ago
Less Prone favorited tjdavis's photo
23 hours ago
Less Prone favorited rlionhearted_3's photo
23 hours ago
John Miller commented on rlionhearted_3's photo
Thumbnail

Another incredibly Stupid!! What, no mirrors?

"Brutal post... not sure it’s helping anyone though."
yesterday
John Miller replied to cheeki kea's discussion Tartaria
"Tartaria: the empire that built half the world's cathedrals, then vanished because someone…"
yesterday
Burbia commented on rlionhearted_3's photo
Thumbnail

Another incredibly Stupid!! What, no mirrors?

"This movie portrayed plastic surgery as absurd. I guess the numbers in the real world are growing."
yesterday
Burbia commented on tjdavis's photo
Thumbnail

Redux

"Ah yes, General Jussitri Smolletkov. Good tongzhi. Good tongzhi."
yesterday
Doc Vega posted a blog post

Unusual Discoveries and Headlines

Archaeologists have discovered an ancient tool dated to be 6,000 years old, but even more…See More
Monday
tjdavis posted a video

Inside Texas HOMELESS HELL – Even Cops Don't Dare Step In! - Documentary

In this powerful documentary, we explore the escalating Texas homeless crisis 2025, where cities and rural areas alike are witnessing a disturbing rise in th...
Monday
tjdavis posted a photo
Monday
John Miller replied to MAC's discussion BREAKING! UFO whistleblowers drop BOMBSHELL on D.C. | Redacted with Natali and Clayton Morris
"Crazy how these whistleblower stories are finally making it into bigger conversations. Makes you…"
Sunday
Burbia favorited tjdavis's blog post The Dems Love Their Demons
Sunday
John Miller commented on tjdavis's photo
Thumbnail

Comprehensive Coverage

"That car needs an exorcism, not an oil change."
Saturday
John Miller commented on tjdavis's blog post The Dems Love Their Demons
"If the Dems are dating demons, then that AI romance shoot was basically engagement photos."
Saturday
John Miller replied to cheeki kea's discussion Would-Be Trump Assassin Ryan Routh Gave Many Interviews with Mainstream Media
"Wouldn't be surprised if there's a whole lot more buried under the surface here."
Saturday
Less Prone favorited rlionhearted_3's photo
Saturday
Less Prone left a comment for John Miller
"Welcome John."
Saturday
Doc Vega posted a blog post

The Saga of Ape Canyon Revisited

 In the years that I’d written for the Plano Star Courier I got several invitations to go on…See More
Saturday
John Miller is now a member of 12160 Social Network
Saturday

© 2025   Created by truth.   Powered by

Badges  |  Report an Issue  |  Terms of Service

content and site copyright 12160.info 2007-2019 - all rights reserved. unless otherwise noted