Six Banks Fail; 2010 Total at 157

Updated from 12/17/2010
Updated to include more details on the failures.

WASHINGTON ( TheStreet) -- Government authorities announced the closure of six more U.S. banks late Friday -- one in Arkansas, three in Georgia, one in Florida, and one in Minnesota -- bringing 2010's total to 157.

The failed institutions are First Southern Bank, Batesville, Ark.; United Americas Bank, NA, Atlanta; Appalachian Community Bank, F.S.B., McCaysville, Ga.; Chestatee State Bank, Dawsonville, Ga.; The Bank of Miami, NA, Coral Gables, Fla., and Community National Bank, Lino Lakes, Minn.

The Federal Deposit Insurance Corp. was named receiver in each of the failures and said that they would cost the agency's insurance fund an estimated $267.6 million.

The branches of the failed institutions are all expected to reopen on Monday as branches of their acquirers.

All but two of the failed banks were previously included in TheStreet's Bank Watch List of undercapitalized institutions, based on preliminary third-quarter regulatory data provided by SNL Financial.

The two failed banks that didn't previously appear on the Bank Watch List were First Southern Bank and Community National Bank.

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First Southern Bank

When the Arkansas State Banking Department shuttered First Southern Bank, Commissioner Candace Franks said the institution's failure was not the result of poor quality loans, but the result of an imprudent business relationship between First Southern Bank and one individual.

On Dec. 6, Arkansas Business had reported that the bank was looking to merge with another institution because it had purchased $22 million in potentially fraudulent rural improvement district bonds between December 2008 and September 2010. The FDIC was helping the bank investigate the authenticity of the bonds.

First Southern Bank had $191.8 million in total assets when state regulators took over the institution. The FDIC sold the failed bank's $155.8 million in deposits for a 0.25% premium and $152.8 million in assets to Southern Bank of Poplar Bluff, Mo. The agency retained the remaining assets for later disposition.

The acquiring bank is the main subsidiary of Southern Missouri Bancorp ( SMBC).

The estimated cost of the bank failure to the FDIC's deposit insurance fund was $22.8 million.

Community National Bank

Although Community National Bank had sufficiently high capital ratios as of Sept. 30 to stay off TheStreet's Bank Watch List, it had a very high level of nonperforming loans, and the Office of the Comptroller of the Currency announced that "the bank, by resolution of its board of directors and its shareholders, consented to receivership." The institution had $31.6 million in total assets when it failed.

The FDIC was appointed receiver and arranged for Farmers & Merchants Savings Bank of Manchester, Iowa, to assume the failed institution's assets and deposits. The FDIC estimated the cost of Community National Bank's failure to the deposit insurance fund would be $3.7 million.

The Bank of Miami, NA

The OCC took over The Bank of Miami, which had $448.2 million in total assets. As receiver, the FDIC arranged for 1st United Bank of Boca Raton, Fla. to assume the failed bank's deposits and $442.3 million in assets, with the agency retaining the rest for later disposition.

The FDIC agreed to cover 80% of losses on $313.5 million of the assets acquired by 1st United Bank and estimated the cost to the deposit insurance fund would be $64 million.

The acquiring bank is the main subsidiary of 1st United Bancorp ( FUBC).

Chestatee State Bank

The Georgia Department of Banking and Finance shut down Chestatee State Bank. The FDIC was appointed receiver and sold the failed bank's $244.4 million in assets and all of its deposits to Bank of the Ozarks ( OZRK) of Little Rock, Ark.

The FDIC agreed to cover 80% of losses on $195.3 million in acquired assets and estimated the cost of the bank closure to the deposit insurance fund would be $75.3 million.

Appalachian Community Bank, FSB

The Office of Thrift Supervision closed Appalachian Community Bank, FSB and appointed the FDIC receiver. The failed thrift had $68.2 million in assets and $76.4 million in deposits, putting it in a negative capital position.

The FDIC arranged for Peoples Bank of East Tennessee to assume most of the failed institution's retail deposits, and was scheduled to mail checks to out-of-state customers with certificates of deposit. Customers with brokered CDs were advised to "contact their broker directly to obtain information on the status of their funds."

In addition to the in-state retail deposits, Peoples Bank of East Tennessee purchased $67.5 million of the failed thrift's assets, with the FDIC retaining the rest for later disposition. The agency also agreed to cover 80% of losses on $46.4 million of the acquired assets.

The FDIC estimated the failure would cost the deposit insurance fund $26 million.

United Americas Bank, NA

The OCC also took over United Americas Bank, which had $242.3 million in total assets. As receiver, the FDIC arranged for State Bank and Trust Company of Macon, Ga. to assume the failed institution's assets and deposits, with the agency agreeing to share in losses on $195.8 million of the acquired assets.

State Bank and Trust Company is the main subsidiary of State Bank Financial (STBZ.PK).

The FDIC estimated the cost of United Americas Bank's failure to the deposit insurance fund would be $75.8 million.

Thorough Bank Failure Coverage

All bank and thrift closures since the beginning of 2008 are detailed in TheStreet's interactive bank failure map:

The bank failure map is color-coded, with the states having the greatest number of failures highlighted in dark gray, and states with no failures in light green. By moving your mouse over a state you can see its combined 2008-2010 totals. Then click the state to open a detailed map pinpointing the locations and providing additional information for each bank failure.

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-- Written by Philip van Doorn in Jupiter, Fla.

>To contact the writer of this article, click here: Philip van Doorn.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., 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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