The Federal Deposit Insurance Corporation or FDIC announced Friday the shuttering of the 15th U.S. bank in 2010, after the 140 bank closures in 2009, following the closure of Bainbridge Island, Washington-based American Marine Bank by the Washington Department of Financial Institutions. Another five banks were also closed on Friday by the regulators, with the assets of the failed banks beings assumed by other banks in an FDIC assisted transaction.
The other five banks that closed on Friday are Carrollton, Georgia-based First National Bank of Georgia, Immokalee, Florida-based Florida Community Bank, Hallock, Minnesota-based Marshall Bank, National Association, Cornelia, Georgia-based Community Bank and Trust, and Los Angeles, California-based First Regional Bank.
First National Bank of Georgia's deposits were assumed from FDIC by Carrollton, Georgia-based Community & Southern Bank, Florida Community Bank's deposits were taken over by Miami, Florida-based Premier American Bank, National Association, and assets of American Marine Bank were acquired by Tacoma, Washington-based Columbia State Bank.
Meanwhile, Marshall Bank, National Association was taken over by Cavalier, North Dakota-based United Valley Bank, Community Bank and Trust's assets were taken over by Orangeburg, South California-based SCBT Financial Corp. (SCBT), and First Regional Bank was taken over by Raleigh, North Carolina-based First-Citizens Bank & Trust Co.
The FDIC noted that customers of all the failed banks can this evening and over the weekend access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed, and loan customers should continue to make their payments as usual. The FDIC also asked the customers to continue using their existing branch until they receive notice that the takeover of the failed banks have been completed.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) by the six bank closures will be a total of $1.86 billion.
With six more banks closing shutters on Friday, the total bank closures for 2010 has reached 15. An average of 12 banks have failed per month in 2009, with bank closures for 2009 totaling 140, which is nearly six times the number that were closed in 2008 of 25 bank failures. It's the highest total bank failures in a year since 1992, when 181 banks failed. Only three banks failed in 2007. But the all time record for bank closures was in 1989 when 534 banks closed.
Customers of the failed banks are protected, by the FDIC, which has insured bank deposits since the Great Depression, currently covering customer accounts up to $250,000. The federal coffer is thinning under the massive strain to now stand below $10 billion from $45 billion a year ago. Reports suggest that bank failure costs are expected to total $100 billion over the next four years.
The FDIC insures deposits at the nation's 8,195 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed.
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