HANCOCK, Minn. (
) -- State regulators shut down
1st American State Bank of Minnesota
, of Hancock, Minn. Friday, bringing the total of number of failed U.S. banks this year to sixteen.
The bank had been assigned an E-minus (Very Weak) financial strength rating by
back in March, and was included in
As receiver, the Federal Deposit Insurance Corp. arranged for
Community Development Bank, FSB
of Ogema, Minn., to assume the failed institution's $16.3 million in deposits and $18.2 million in total assets. The FDIC agreed to share in losses on $11.7 million of the acquired assets.
Community Development Bank was not charged a premium to acquire the deposits, and the FDIC estimated the cost to its insurance fund would be $3.1 million.
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1st American State Bank's two branches were scheduled to reopen Monday as branches of Community Development Bank.
This was the 10th bank failure in Minnesota since the beginning of 2008.
Ongoing Bank Failure Coverage
All previous bank and thrift failures since the beginning of 2008 are detailed in
interactive bank failure map:
The bank failure map is color-coded, with states having the greatest number of failures highlighted in red and states with no failures in gray. By hovering your mouse over a state you can see the totals for that state. You can click on the state to open a detailed map that pinpoints the locations of the failures and provides additional information.
leads all states with 32 bank or thrift failures from the beginning of 2008 through Friday, followed by
with 23 each and
Large holding companies acquiring failed institutions during the current crisis 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
; Zions Bancorp;
The FDIC has extended through 2013 its increase to $250,000 from $100,000 for its basic limit on individual deposit insurance coverage. Although the agency also temporarily waived all deposit insurance limits for business transaction accounts (checking accounts), the insurance limit on these accounts are scheduled to go back to $100,000 on June 30.
After that happens, 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
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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.