) -- Regulators shut down six banks and thrifts Friday, including
, a Cleveland thrift that had $12 billion in assets.
The closings bring the 2009 total of failed U.S. banks and thrifts to 130.
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
select list of strong banks paying
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.
AmTrust Branches were set to reopen during normal business hours as branches of New York Community Bank, but under the name of "AmTrust Bank, a division of NYCB."
Friday's Other Failures
Meanwhile, the Georgia Department of Banking and Finance shuttered
The Buckhead Community Bank
of Atlanta. As receiver, the FDIC arranged for
State Bank and Trust Co.
of Macon, Ga. to assume the failed bank's $838 million in deposits and nearly all of its assets, which totaled $874 million. The FDIC agreed to share in losses on $692 million of the acquired assets and estimated the cost to the deposit insurance fund would be $241 million. Buckhead Community's six offices were set to reopen during normal business hours as branches of State Bank and Trust Co.
The Office of the Comptroller of the Currency closed
First Security National Bank
of Norcross, Ga. As receiver, the FDIC arranged for State Bank and Trust Co. to make its second acquisition of the evening. State Bank and Trust assumed the failed bank's $123 million of deposits and $118 million of its $128 million in assets, with the FDIC retaining the rest for later disposition. The FDIC agreed to share in losses on $82 million of the acquired assets and estimated the cost to its insurance fund would be $30 million. First Security's branches were also set to reopen during normal business hours as State Bank and Trust branches.
State regulators closed
of Reidsville, Ga., which had total assets of $50 million and $47 million in deposits. The FDIC arranged for
HeritageBank of the South
, of Albany, Ga. to assume all of the failed bank's deposits and most of its assets, in a deal estimated to cost the insurance fund $13.9 million. HeritageBank is a subsidiary of
Heritage Financial Group
. Tattnall Bank's two offices were scheduled to reopen during normal business hours as HeritageBank branches.
Elsewhere, the Illinois Department of Financial and Professional Regulation shut down
of Aurora, Ill., and the FDIC arranged for
MB Financial Bank NA
of Chicago to acquire all of the failed institution's deposits and assets.
MB Financial Bank is the main subsidiary of
MB Financial Group
, and Benchmark is its fourth government-assisted acquisition this year. The others were
of Oak Forest, Ill. and
of Glenwood, Ill.
Benchmark Bank had $170 million in assets and $181 million in deposits. Its five branches were set to reopen during regular business hours as branches of MB Financial Bank. The FDIC agreed to share in losses on $139 million of the acquired assets and estimated the cost to its insurance fund would be $64 million.
The OTS closed
Greater Atlantic Bank
of Reston, Va., and the FDIC sold the failed thrift's $203 million in assets and $179 million in deposits to Sonabank of McLean, Va., a subsidiary of
Southern National Bancorp of Virginia
The FDIC agreed to share in losses on $145 million of assets acquired by Sonabank and estimated the cost to its insurance fund would be $35 million. Greater Atlantic Bank's five offices were scheduled to reopen during normal business hour as branches of Sonabank.
Ongoing Bank Failure Coverage
All previous bank and thrift failures for 2008 and 2009 are detailed in
interactive bank failure map:
The bank failure map is color-coded. States that have the largest number of failures are highlighted in red, and states with no failures are highlighted in gray. By hovering your mouse over a state you can see its combined 2008-2009 totals. Clicking on a state will open a detailed map that pinpoints the locations of failed banks and provides additional information for each failure.
continues to lead all states with 29 bank or thrift failures during 2008 and 2009, followed by
with 20, and
Large holding companies acquiring failed institutions during 2008 and 2009 have included
J.P. Morgan Chase
, which acquired Washington Mutual, the largest-ever bank or thrift to fail in the U.S;
Fifth Third Bancorp
Free Financial Strength Ratings
The FDIC has extended through 2013 its temporary increase of its basic limit on insurance coverage for individual deposits to $250,000 from $100,000. The agency 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.
After that waiver expires, 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.
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
In addition, the Financial Strength Ratings for 4,000 life, health, annuity, and property/casualty insurers are available on the
also provides award-winning stock ratings, which are available on the
was recently ranked the No. 1 independent stock selector during the market meltdown by BNY ConvergEx Group's BNY Jaywalk.
Written 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.