Corus Bank Finally Fails
CHICAGO (
) --
Corus Bank NA
was finally shut down by the Office of the Comptroller of the Currency late Friday, ending a long slide for the condominium lender and bringing the total of failed banks and thrifts this year to 90.
The Federal Deposit Insurance Corp. was appointed receiver of Corus, a subsidiary of
Corus Bankshares
( CORS), and sold all of the bank's deposits to
MB Financial Bank
, a subsidiary of
MB Financial
(MBFI) - Get Report
. Corus's eleven branches were set to reopen during normal business hours as branches of MB Financial Bank.
The acquisition was MB Financial's second in a week, following its takeover of the failed
of Oak Forest, Ill.
Corus had about $7 billion in total assets and $7 billion in deposits. In addition to the deposits and branches, MB Financial Bank took over about $3 billion in deposits. The FDIC said it expected to sell most of the remaining assets in a private transaction over the next 30 days, and estimated the cost to the deposit insurance fund would be $1.7 billion.
The OCC's action followed a published
New York Times
report published Thursday, saying that the
was looking to make separate deals to sell Corus's deposits and loans.
TheStreet.com
has covered the Chicago lender's declining loan quality and dwindling capital since August 2007, when Corus Bancorp's
seemed threatened after the holding company paid out a special dividend of $1 a share, while problems were mounting in the bank's condominium construction and conversion portfolio.
That special dividend netted then-CEO Robert J. Glickman and his family, who owned a controlling interest in Corus at the time, about $25 million, according to published reports.
Following nearly two years of steady decline as the bank's loans -- nearly all condominium construction and conversion loans in key boom-and-bust states such as Florida and California -- soured and losses mounted, Corus announced on July 31 that both the holding company and the bank were
, with negative equity as of June 30.
Corus Bank was included in
TheStreet.com's
list of banks and thrifts that were
as of June 30 -- one of five institutions on the list with negative capital positions. Of a similar list of 89 banks and thrifts that were undercapitalized at the end of the first quarter, 40 have already failed.
Ongoing Bank Failure Coverage
All failures for 2008 and 2009 through last week are detailed in
TheStreet.com's
interactive bank failure map:
leads all states with 23 bank or thrift failures during 2008 and 2009, followed by
with 17,
with 14,
with eight and
with five failures.
JPMorgan Chase
(JPM) - Get Report
, which acquired Washington Mutual, the largest-ever bank or thrift to fail in the U.S., is among the large bank holding companies that have acquired failed institutions during 2008 and 2009. Others include
SunTrust Banks
(STI) - Get Report
,
Regions Financial
(RF) - Get Report
,
Fifth Third Bancorp
(FITB) - Get Report
,
U.S. Bancorp
(USB) - Get Report
,
Zions Bancorp
(ZION) - Get Report
,
PNC Financial
(PNC) - Get Report
and
BB&T
(BBT) - Get Report
.
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--
Reported by Philip van Doorn in Jupiter Fla.
Philip W. van Doorn joined TheStreet.com Ratings., Inc., in February 2007. He is the senior analyst responsible for assigning financial strength ratings to banks and savings and loan institutions. He also comments on industry and regulatory trends. Mr. van Doorn has fifteen years experience, having served as a loan operations officer at Riverside National Bank in Fort Pierce, Florida, and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a Bachelor of Science in business administration from Long Island University.
