Banks in four US states with more than $1 billion in assets were closed in a single day, boosting the toll of seized lenders to 13 this year and further draining a deposit insurance fund amid record home foreclosures.
Florida, Nebraska, Illinois and Oregon regulators took over the banks on 13 February and, with the Federal Deposit Insurance Corp, sold $807.5 million in deposits and arranged to open the branches under new names on 17 February . The FDIC said the shutdowns, the most on one day since 1992, will cost the agency $341.6 million.
Florida’s Riverside Bank of the Gulf Coast in Cape Coral, Nebraska’s Sherman County Bank in Loup City, Illinois’ Corn Belt Bank and Trust Co of Pittsfield and Oregon’s Pinnacle Bank of Beaverton were shut. TIB Bank of Naples bought Riverside’s $424 million of deposits, the FDIC said. Heritage Bank of Wood River got Sherman County’s $85.1 million of deposits, Carlinville National Bank gained Corn Belt’s $234.4 million deposits and Washington Trust Bank of Spokane got Pinnacle’s $64 million.
Regulators have now seized 13 banks, and seven so far in February are the most for a month since 1993. State and federal agencies shuttered 25 banks last year, matching the total for 2001-2007, as home foreclosures soared and bank profits tumbled. The FDIC has doubled premiums it charges banks to replenish its reserves, which had $34.6 billion as of the third quarter.
