12/07/2009

Massive Bank Failures, then a Bank Holiday?


A woman walks out of AmTrust Bank Saturday, Dec. 5, 2009, in Woodmere, Village, Ohio. Regulators have shut down six more banks, bringing to 130 the number of U.S. banks to be brought down so far in 2009 by recession and mountains of bad debt. The Federal Deposit Insurance Corp. on Friday took over Ohio's AmTrust Bank, the fourth-largest bank to fail this year, with about $12 billion in assets and $8 billion in deposits. The Cleveland-based bank's failure is expected to cost the federal deposit insurance fund an estimated $2 billion.

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Tracking Bank Failures: Regulators Seize AmTrust

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Wall Street Journal
December 7, 2009, 12:29 PM ET

By Stephen Grocer
Federal regulators finally pulled the plug on AmTrust Bank Friday.

The battered Cleveland thrift, with $12 billion in assets and roots back to 1889, is the fourth-largest U.S. bank or savings institution to fail so far this year.

AmTrust has been riding a regulatory rollercoaster for the past year. Last fall, the OTS rejected AmTrust’s requests for TARP funds. The regulator then slapped AmTrust with a cease-and-desist order, citing “unsafe and unsound banking practices,” and required the thrift to shore up its capital, stop making certain loans and rein in the rates being offered for customer deposits.

After AmTrust missed a deadline to raise capital, the FDIC in January approached other banks to gauge their takeover interest. But AmTrust was kept alive after local politicians pleaded with the government for a second chance.

That was until Friday. New York Community Bancorp is acquiring AmTrust and its 66 branches — a dramatic expansion for New York Community.

The FDIC said the AmTrust failure was expected to cost its deposit-insurance fund about $2 billion.

Five other banks failed on Friday as well. Three of the banks were based in Georgia: Tattnall Bank of Reidsville, First Security National Bank of Norcross, and Buckhead Community Bank of Atlanta. Georgia has been ground zero for bank failures this year, with 24 institutions seized by regulators. Also failing on Friday were Benchmark Bank of Aurora, Ill., and Greater Atlantic Bank of Reston, Va.

That brings the total number of failed banks this year to 130. Since 2008, 155 banks have been seized by regulators.

Click on the image below to see WSJ’s map of U.S. bank failures.




A MUST SEE LINK, click on link below
http://s.wsj.net/public/resources/documents/info-Failed_Banks-sort.html


Airtime: Tues. Nov. 24 2009 | 9:02 AM ET
CNBC's Hampton Pearson has the details on the FDIC report on banking





Bank Failures Total at 123 : Wed. Nov. 18 2009 | 6:10 AM ET
The FDIC has seized 123 banks so far this year, but is there any opportunity arising from the destruction? John Kanas, CEO of BankUnited, and Cam Fine, CEO of the Independent Community Bankers of America, share their insight.


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Number of Troubled Banks Rises to 552; FDIC Fund Sinks Into the Red

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By Wall Street Journal
By JESSICA HOLZER
11-25-09

WASHINGTON -- The government insurance fund that protects more than $4.5 trillion of U.S. bank deposits slipped into the red at the end of September, after fifty banks collapsed during the third quarter.

The deposit insurance fund dropped by $18.6 billion during the third quarter of 2009 to negative $8.2 billion, as the Federal Deposit Insurance Corp. set aside $21.7 billion in provisions for additional bank failures. This is the second time in the agency's history that the balance has fallen into negative territory.

The FDIC has already called on the industry to prepay $45 billion in assessments at the end of the year that will be set aside to cover the cost of bank failures in 2010.

Fifty U.S. banks failed in the third quarter, the largest quarterly total since 55 banks went bust during the second quarter of 1990. The FDIC's list of "problem" banks swelled to 552 at the end of September, its highest level in 16 years and up from 416 in June.


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Local Bank Taken Over By Federal Government
KGTV ABC San Diego
Oct. 31, 2009.
San Diego National Bank was taken over by the federal government after falling on tough times.





California National Bank Fails, Is Seized By FDIC - The Los Angeles-based, 68-branch bank is immediately acquired by the US Bank unit of US Bancorp.



FDIC officials enter the California National Bank branch at 221 S. Figueroa St. in downtown Los Angeles as the bank is taken over. The bank's 68 branches are set to reopen Saturday or Monday as usual as branches of U.S. Bank. (Gary Friedman / Los Angeles Times / October 30, 2009)

Bunning Grills Bernanke, With Response



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