Tag Archives: Bank Failure

Chatter about a sudden sweep of bank failures may be all the rage in Europe, but fewer closures for financial institutions stateside led the FDIC to shutter a temporary office in the Midwest on Friday. The glacial crawl for U.S. bank failures makes good on FDIC predictions that fewer institutions would fail over 2011 as more ledgers stay in the black - a change of pace for an era in which the federal agency closed a record number of banks. The FDIC said Friday that it would close the Midwest Temporary Satellite Office in Illinois.

In another twist for the nation's largest mortgage lenders, Wells Fargo upped the ante against JPMorgan Chase & Co. by filing a suit in a Delaware court to order the latter to buy back over $558 million in bad mortgage-backed securities. Multiple news outlets offered up the latest tizzy Thursday, with Wells escalating the case after JPMorgan refused to budge on the repurchases. The loans stem from the Bear Stearns Mortgage Funding Trust 2007-AR2, otherwise known as the EMC unit, which JPMorgan acquired in 2008.

Charter Financial Corporation is growing, via its acquisition of The First National Bank of Florida. Conducting the deal through its wholly owned subsidiary, CharterBank, Charter structured an agreement with the Federal Deposit Insurance Corporation to assume all deposits as well as the majority of assets of the Milton, Florida-based bank. The First National Bank of Florida was officially declared closed by the Office of the Comptroller of the Currency, and the FDIC was named as its receiver.

Amid national bank failures that recently ticked up to 70, the FDIC announced Friday that it will stand up a new networking platform that seeks to make it easier for small investors to take a slice of the pie.

As Americans vacationed over Labor Day weekend, the FDIC and other regulators found themselves swamped with new bank failures Friday, with the federal agency serving as receiver for two in Georgia. State regulators stepped in to shutter Cumming-based Patriot Bank of Georgia and Woodstock-based CreekSide Bank, signing off on a loss-share transaction that left Atlanta-based Georgia Commerce Bank as the sole acquirer. The collapse of Patriot and Creekside raises the national tally for bank failures to 70 this year.

The FDIC went after 34 banks for violations of federal law and agency requirements over July, slapping nearly 20 with civil fines, notifying some to correct recent decisions, and barring directors with two institutions to cease their involvement in executive decisions over allegations of personal and fiduciary misconduct. The majority of institutions felt the sting of civil money fines for various reasons. Also, no banks failed over the weekend, leading an FDIC spokesperson to conclude that the trend will continue over 2011.

In welcome news for market watchers everywhere, FDIC-insured banks and savings institutions opened their books to reveal a $28.8-billion in aggregate profits over the second quarter, according to the federal agency.

Four banks walked the line to failure over the weekend, raising the bank collapse figure to 68 on the heels of increased public scrutiny by lawmakers over bank failures. Illinois-based First Choice Bank, Georgia-based First Southern National Bank, Florida-based Lydian Private Bank, and Pennsylvania-based Public Savings Bank all left the table, leaving the FDIC to foot the whopping $374.8-million bill. The FDIC found itself playing the familiar role of receiver in all four loss-share transactions by other banks.

With the latest bank failure tallying up numbers for 2011 at 64, lawmakers convened a field hearing in Georgia Tuesday to determine whether risk-wary authorities are to blame for folding institutions and federal rescues. Appearing as witnesses, several bank presidents complained of a stifling regulatory environment, which federal regulatory authorities, in turn, portrayed as needed and helpful in the wake of the financial crisis. According to the FDIC, this year's 64 failures followed 157 from last year, which built on 140 failures over 2009, totaling 380 failures since 2008.

A rollercoaster Dow Jones Industrial Average, successive downgrades in U.S. Treasury and GSE debt, and renewed worries over euro zone defaults buried news over the weekend that the FDIC circled wagons around two new failed banks. The federal agency covered the $160.4 bill left by two banks in Illinois and Washington that brought the failed financial institutions tally to 63 for the year. Requiring the FDIC to step in as receiver, Illinois-based Bank of Shorewood and Washington-based Bank of Whitman both closed.