Federal regulators close Florida-based bank, eleventh U.S. bank failure of 2010

January 30th, 2010 - 4:38 pm ICT by BNO News  

IMMOKALEE, FLORIDA (BNO NEWS) — Federal regulators on Friday closed the Florida Community Bank in Immokalee, Florida marking the eleventh U.S. bank failure of 2010 following an economic turbulent year that saw more than one hundred U.S. banks fail.

The Florida Community Bank was closed by the Florida Office of Financial Regulation after its regular closing time on Friday. The Federal Deposit Insurance Corporation (FDIC) was appointed as receiver following its closure, who immediately entered into a purchase and assumption agreement with the Florida-based Premier American Bank, National Association to assume all of the failed bank’s deposits.

Most, if not all customers, should see no or little service disruptions despite the closure of the institution. On Saturday, all 11 branches of the Florida Community Bank will reopen during their normal business hours as branches of Premier American Bank, N.A.

All of the failed bank’s services, including checks, ATM and debit cards, will remain active. “Checks drawn on the bank will continue to be processed,” the FDIC said in a statement. “Loan customers should continue to make their payments as usual.”

As of September of last year, the Florida Community Bank had approximately $875.5 million in total assets and $795.5 million in total deposits. Premier American Bank, N.A. paid the FDIC a premium of 0.4 percent to assume Florida Community Bank deposits, the FDIC said. “In addition to assuming all of the deposits of the failed bank, Premier American Bank, N.A. agreed to approximately $499.1 million of the failed bank’s assets. The FDIC will retain the remaining assets for later disposition. ”

The FDIC and Premier American Bank, N.A. entered into a loss-share transaction on approximately $305.4 million of Florida Community Bank’s assets. Premier American Bank, N.A. will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers.

The FDIC said it estimates that the cost to the Deposit Insurance Fund (DIF) will be $352.6 million. It said Premier American Bank, N.A.’s acquisition of the deposits was the “least costly” resolution compared to other alternatives.

Friday’s closure was not only the eleventh U.S. bank failure of 2010 but was also Florida’s second bank this year. Regulators last closed the Premier American Bank in Miami.

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