Six Banks Fail, 2010 Tally at 15

WASHINGTON ( TheStreet) -- Six community banks failed Friday, bringing the 2010 tally of failed U.S. banking institutions to 15.

Friday's failures are expected to cost the Federal Deposit Insurance Corp.'s insurance fund a total of $1.9 billion.

All six failed institutions had been previously assigned E-minus (Very Weak) financial strength ratings by TheStreet.com Ratings, and all were included in TheStreet.com's list of undercapitalized banks and thrifts.

The Office of the Comptroller of the Currency shut down First National Bank of Georgia of Carrollton, Ga., a subsidiary of WGNB ( WGNB.PK). The FDIC was appointed receiver and sold the failed bank's $758 million in deposits for a 1.25% premium to Community & Southern Bank, also of Carrollton, Ga.

Community & Southern also acquired the failed bank's $833 million in assets, with the FDIC agreeing to share in losses on $607 million and estimating that the cost to its insurance fund would be $260.4 million. First National Bank of Georgia's 11 offices were set to reopen Saturday as Community & Southern branches.

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State regulators took over another Georgia bank, Community Bank and Trust of Cornelia. The FDIC was appointed receiver and arranged for SCBT NA of Orangeburg, S.C. to take over the failed bank's $1.1 billion in deposits and $1.2 billion in assets for no premium. SCBT NA is a subsidiary of SCBT Financial ( SCBT).

The FDIC agreed to share in losses on $828 million of the acquired assets, and estimated the failure of Community Bank and Trust would cost the deposit insurance fund $354.5 million.

The failed Bank's 36 branches were scheduled to reopen during normal business hours as SCBT branches, although they will continue to operate under the Community Bank and Trust name.

Elsewhere, the Florida Office of Financial Regulation closed Florida Community Bank of Immokale, Fla., a subsidiary of Florida Community Banks ( FLRB). The FDIC was appointed receiver and sold the failed institution's deposits to Premier American Bank NA of Miami for a small premium.

Premier American Bank NA was organized last week to take over the failed Premier American Bank. The new Premier American's holding company, Bond Street Holdings of New York, was granted a "shelf charter" by the OCC back in October.

Florida Community Bank had total assets of $876 million, and Premier American agreed to acquire $499 million of the failed bank's assets, with the FDIC agreeing to share in losses on $305 million and estimating $352.6 million in costs to the deposit insurance fund.

Florida Community's 11 branches were scheduled to reopen Saturday as branches of Premier American.

Meanwhile, the OCC shuttered Marshall Bank NA of Hallock, Minn. and appointed the FDIC receiver. The FDIC sold the failed bank's $55 million in deposits for a 7.5% premium to United Valley Bank of Cavalier, N.D. United Valley also took over the failed bank's total assets of $60 million, with the FDIC sharing in losses on $24 million and estimating $4.1 million in costs to its insurance fund.

Marshall's three branches were set to reopen as United Valley branches on Monday.

California Regulators closed First Regional Bank of Los Angeles, a subsidiary of First Regional Bancorp ( FRGB). The FDIC was appointed receiver and arranged for First-Citizens Bank & Trust of Raleigh, N.C. to assume the failed bank's $1.9 billion in deposits and nearly all of its $2.2 billion in total assets, with the FDIC agreeing to share in losses on $2 billion of the acquired assets.

First-Citizens is a subsidiary of First-Citizens Bancshares ( FCNCA). This is the second major acquisition of a failed California bank by First Citizens, after it took over Temecula Valley Bank in July.

First Regional's eight offices were scheduled to reopen Monday as branches of First-Citizens. The FDIC estimated the cost of the failure to its deposit insurance fund would be $825.5 million.

Lastly, the Washington Department of Financial Institutions closed American Marine Bank of Bainbridge Island, Wash., and appointed the FDIC receiver. The FDIC sold the failed bank's $309 million in deposits for a 1% premium to Columbia State Bank of Tacoma, Wash., a subsidiary of Columbia Banking System ( COLB).

Columbia State Bank also took over the failed bank's $373 million in total assets, with the FDIC agreeing to share in losses on $255 million and estimating the cost to its insurance fund would be $58.9 million.

This was Columbia State Bank's second acquisition in two weeks, after taking over the failed Columbia River Bank of The Dalles, Ore.

American Marine's 11 branches were set to reopen Saturday as branches of Columbia State Bank.

Ongoing Bank Failure Coverage

All previous bank and thrift failures since the beginning of 2008 are detailed in TheStreet.com's interactive bank failure map:
chart

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. Then click on the state to open a detailed map that pinpoints the locations of the failures and provides additional information.

Georgia leads all states with 32 bank or thrift failures from the beginning of 2008 through Friday, followed by Illinois and California with 23 each and Florida with 18.

Large holding companies acquiring failed institutions during the current crisis have included J.P. Morgan 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; and PNC Financial ( PNC); and BB&T ( BBT).

The FDIC's temporary increase of agency's basic limit on individual deposit insurance coverage to $250,000 from $100,000 has been extended through 2013. While 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.

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.

In addition, the Financial Strength Ratings for 4,000 life, health, annuity, and property/casualty insurers are available on the Insurers & HMOs Screener.

TheStreet.com Ratings also provides award-winning stock ratings, which are available on the Stock Ratings Screener.

TheStreet.com Ratings 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.

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