New Bank Failures: Week of Nov. 9

NEW YORK (TheStreet) -- Five new bank failures on Friday brought the total number of banks and thrifts shut down by regulators this year to 120.

All 145 bank failures since the beginning of 2008 are detailed on TheStreet.com's interactive bank failure map:

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The bank failure map is color-coded, with states having the greatest number of failures highlighted in red, and states with no failures in grey.

The most significant failure -- and the seventh-largest during the 2008-2009 crisis -- was United Commercial Bank of San Francisco, the main subsidiary of UCBH Holdings (UCBH). The Federal Deposit Insurance Corp. and Chinese bank regulators worked together to arrange for East West Bank of Pasadena, Calif. to take over United Commercial's operations, as well as its UCB-China subsidiary in Shanghai.

East West Bank is a subsidiary of East West Bancorp (EWBC). United Commercial had $10.2 billion in assets when it failed, and the FDIC estimated the cost of the failure to its insurance fund would be $1.4 billion.

Georgia regulators closed United Security Bank of Sparta and the FDIC sold the failed bank's deposits and its total assets of $157 million to Ameris Bank of Moultrie, Ga., a subsidiary of Ameris Bancorp (ABCB). The FDIC agreed to share in losses on $123 million of the acquired assets and estimated the cost to its insurance fund would be $58 million.

The Office of Thrift Supervision shuttered Home Federal Savings Bank of Detroit, and the FDIC arranged for Liberty Bank and Trust Co. of New Orleans to assume the failed thrift's deposits and its $14.9 million in total assets, with the failure costing the insurance fund an estimated $5.4 million

State regulators in Minnesota took over Prosperan Bank of Oakdale, with the FDIC selling the failed bank's deposits and $174 million of Prosperan's $200 million in assets to Alerus Financial NA of Grand Forks, N.D., a subsidiary of Alerus Financial ( ALRS.PK ). The FDIC agreed to share in losses on the acquired assets and estimated the cost to its insurance fund would be $60.1 million.

The Missouri Division of Finance closed Gateway Bank of St. Louis. The FDIC arranged for Central Bank of Kansas City, Mo. to assume the failed bank's deposits and its total assets of $27.7 million and estimated the cost to its insurance fund would be $9.2 million.

Georgia leads all states with 26 bank or thrift failures during 2008 and 2009, followed by Illinois with 20, California with 19, and Floridawith 11 failures.

Large holding companies acquiring failed institutions during 2008 and 2009 have included JPMorgan Chase (JPM), which acquired Washington Mutual, the largest-ever bank or thrift to fail in the U.S; U.S. Bancorp (USB); SunTrust Banks (STI); Regions Financial (RF); Fifth Third Bancorp (FITB); Zions Bancorp (ZION); and PNC Financial (PNC); and BB&T (BBT).

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One of the most important steps the FDIC has taken to curtail the likelihood of bank failures is the temporary increase of agency's basic limit on individual deposit insurance coverage to $250,000 from $100,000. This increase has been extended through 2013.

The FDIC has also temporarily waived all deposit insurance limits for business transaction accounts (checking accounts). This waiver is set to expire on June 30, 2010, after which business checking accounts will go back to the $100,000 deposit insurance limit.

This means it will be more important than ever for business and municipal entities such as school districts to carefully monitor the health of their banks. It's very easy to have more than $100,000 of somebody else's money flowing through a business account.

TheStreet.com Ratings issues independent and very conservative financial strength ratings on each of the nation's 8,500 banks and savings and loans. They are available at no charge on the Banks & Thrifts Screener.

-- Written by Philip van Doorn in Jupiter Fla.

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