This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Regulators Close AmTrust, Other Banks

Stocks in this article: NYB HBOS MBFI SONA

WASHINGTON ( TheStreet) -- Regulators shut down six banks and thrifts Friday, including AmTrust Bank, a Cleveland thrift that had $12 billion in assets.

The closings bring the 2009 total of failed U.S. banks and thrifts to 130.

TheStreet.com Ratings had previously assigned all six failed institutions E-minus (Very Weak) financial strength ratings.

The Office of Thrift Supervision took over AmTrust Bank and appointed the Federal Deposit Insurance Corp. receiver. The FDIC then arranged for New York Community Bank, the main subsidiary of New York Community Bancorp (NYB), to assume AmTrust's $8 billion in deposits, along with $11 billion in assets, with the FDIC retaining the remaining assets (mainly nonperforming loans and repossessed real estate) for later disposition.

New York Community Bancorp was recently included in TheStreet.com's select list of strong banks paying high dividends.

The failure of AmTrust followed a year of large losses from nonperforming residential and construction loans, which left the institution undercapitalized under regulatory guidelines. The OTS had already made enforcement actions, including issuing a cease-and-desist order in November 2008 that required the institution to raise capital and make management changes.

New York Community paid no premium to the FDIC for AmTrust's deposits, spread across 66 branches in Ohio, Florida and Arizona. The FDIC agreed to share in losses on $6 billion of the acquired assets, and in an unusual twist for the current cycle of bank failures, New York Community Bank granted the FDIC a "cash participant instrument," which would "serve as additional consideration for the transaction." New York Community announced it would provide more details on the transaction Monday morning.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,191.37 -195.84 -1.13%
S&P 500 2,002.16 -27.39 -1.35%
NASDAQ 4,637.9940 -43.5030 -0.93%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs