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Bank Failure Tally Hits 90 as Regulators Close Two

Defying forecasts for a slowdown, the national tally for bank failures this year hit 90 as two financial institutions ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô one more than a century old ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô went under in Iowa and Louisiana.


State regulators shuttered Johnston, Iowa-based Polk County Bank and Lacombe, Louisiana-based Central Progressive Bank, appointing the ""FDIC"":http://www.fdic.gov/ receiver. Grinnell-based ""Grinnell State Bank"":http://www.grinnellbank.com/ and New Orleans-based ""First NBC Bank"":http://www.firstnbcbank.com/ scooped up branches, assets, and deposits in purchase-and-assumption agreements.

Polk County Bank turned off the lights after more than 100 years in operation. It closed with $91.6 million in total assets and $82 million in total deposits. The cost to the FDIC's Deposit Insurance Fund: $12 million.

James Schipper, superintendent of the Iowa Division of


Banking, said in a ""statement"":http://www.idob.state.ia.us/ that ""the bank had experienced significant growth in its real estate lending portfolio. This growth combined with the recession led to asset quality problems that resulted in heavy losses and depletion of the bank's capital.""

A family had tried to save the bank by drumming up capital but failed in the endeavor, he added.

Grinnell State assumed virtually all assets and three branches, which reopened Saturday under their new brand.

In Louisiana, First NBC swept up the assets and deposits of Central Progressive, which fell under with approximately $383.1 million in total assets and $347.7 million in total deposits. All told the costs to the FDIC's fund came to $58.1 million.

""As a bank strongly focused on financial strength, relationships and service, we look forward to getting to know our new customers from Central Progressive Bank and to serve their banking needs,"" Ashton Ryan, Jr., the bank's president and CEO, said in a ""statement"":http://www.firstnbcbank.com/pdf/NEWS%20RELEASE-Project%201099.FDIC.pdf.

Also Saturday, all 17 branches, once with Central Progressive, reopened as new branches of First NBC.

The rising toll for bank failures casts a pall on past predictions from the FDIC, which initially held that 2011 would signal a turning point for the collapse and acquisition of financial institutions. The new tally, hitting 90, still falls below 157 bank failures recorded last year.

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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