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Four New Bank Failures Raise National Tally to Seven

Federal and state regulators shuttered four banks Friday, with one in Florida, another in Minnesota, and two in Tennessee responsible for raising the national tally to seven so far in 2012.


First Guaranty Bank and Trust Company of Jacksonville, Florida, went dark with about $377.9 million in total assets and $349.5 million in total deposits. Winter Haven-based ""CenterState Bank of Florida"":http://centerstatebank.com/ assumed virtually all assets, including eight branches that reopened Monday, making First Guaranty the second acquisition for the financial institution in two weeks and the fifth since last year.

State regulators in Minnesota shut down Forest Lake-based Patriot Bank Minnesota. Savage-based ""First Resource Bank"":https://www.firstresourcemn.com/ entered into a purchase and assumption agreement with the ""FDIC"":http://www.fdic.gov/ to assume nearly $108.3 million in total deposits, $111.3 million in total assets, and ownership of three branches that opened their doors once more Saturday.

Regulators in Tennessee acted to close two institutions Friday, including Franklin-based Tennessee Commerce Bank and


Knoxville-based BankEast.

The latter fell dark with approximately $272.6 million in total assets and $268.8 million in total deposits, which Cincinnati, Ohio-based U.S. National Bank Association scooped up along with 10 branches that it rebranded Monday.

Tennessee Commerce collapsed with about $1.185 billion in total assets and $1.156 in total deposits, making it the largest of the four to fail Friday.

The ""Tennessee Department of Financial Institutions"":http://www.tn.gov/tdfi/ said that regulators closed Tennessee Commerce for reasons that included ""impaired capital, unsound condition and the bank's inability to continue normal operations.""

Louisville, Kentucky-based ""Republic Bank & Trust Company"":https://www.republicbank.com/home/home entered into an agreement with the FDIC to purchase virtually all of Tennessee Commerce's assets and deposits as well as one branch.

Steve Trager, CEO of Republic Bank & Trust, said in a statement that ""[w]e are delighted to expand our service into the Nashville market and we look forward to growing in the community.""

State regulators appointed the FDIC receiver in all cases, resulting in more than $600 million in accumulated costs for the Deposit Insurance Fund. The fund relies on a number of revenue streams from premiums it collects from lenders and unsold assets from bank failures, among others.

Greg Hernandez, a spokesperson for the FDIC, says that 2010 as the ""high-water mark"" for closures. That year, 157 financial institutions went under, followed by 92 last year.

He predicts that there will be more failures this year, and adds that community banks with less than $10 billion in assets are ""still under pressure but├â┬ó├óÔÇÜ┬¼├é┬ª also recovering.""

About Author: Ryan Schuette

Ryan Schuette is a journalist, cartoonist, and social entrepreneur with several years of experience in real-estate news, international reporting, and business management. He currently lives in the Washington, D.C., area, where he freelances for DS News and MReport.

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