Regulators Shutter Three Banks

With negative net interest income, FirstCity had no hope of surviving without a significant infusion of new capital.

The FDIC estimate the cost to its deposit insurance fund from FirstCity's failure would be $100 million.

TheStreet.com Ratings had assigned FirstCity a D- (Weak) rating in December, based on the institution's Sep. 30, 2008 financial reports (when the bank was still considered well capitalized). Updated ratings for all U.S. banks and thrifts based on finalized Dec. 31 financial information received from Highline Financial this week, will be available soon.

Colorado National Bank and TeamBank

Both Colorado National Bank and TeamBank were subsidiaries of Team Financial, Inc.(TFIN Quote), of Paola, Kan.

The holding company announced earlier Friday that the OCC had served notice Tuesday that Team Financial's capital restoration plan, which was submitted to the regulator on March 2, was not accepted and that TeamBank was therefore considered undercapitalized. While the holding company left open the possibility the OCC might accept a revised capital restoration plan, the filing said the two subsidiary banks might be placed in receivership.

Colorado National

Colorado National Bank had total assets of $124 million and total deposits of $83 million. The FDIC arranged for Herring Bank of Amarillo, Texas, to acquire all of the failed bank's deposits, along with $117 million in assets. The FDIC agreed to share in losses on $62 million in assets acquired by Herring Bank, with the agency absorbing 80% of the potential losses.

Colorado National's four offices were to reopen Saturday as branches of Herring Bank.