Federal regulators close Minnesota-based bank, sixteenth U.S. bank failure of 2010
February 6th, 2010 - 3:56 pm ICT by BNO NewsWASHINGTON, D.C. (BNO NEWS) — Federal regulators on Friday closed the 1st American State Bank of Minnesota based in Hancock, marking the sixteenth U.S. bank failure of 2010 following an economic turbulent year that saw more than one hundred U.S. banks fail.
The 1st American State Bank of Minnesota was closed by the Minnesota Department of Commerce 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 Minnesota-based Community Development Bank, FSB in Ogema 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 Monday, the two branches of the bank in Hancock and Benson will reopen during their normal business hours as branches of the Community Development Bank, FSB.
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 December 31 of last year, the 1st American State Bank of Minnesota had approximately $18.2 million in total assets and $16.3 million in total deposits. Community Development Bank, FSB did not pay the FDIC a premium to assume all of the bank’s deposits, the FDIC said. “In addition to assuming all of the deposits of the failed bank, Community Development Bank, FSB agreed to purchase essentially all of the assets.”
The FDIC and Community Development Bank, FSB entered into a loss-share transaction on approximately $11.7 million of 1st American State Bank of Minnesota’s assets. Community Development Bank, FSB 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 $3.1 million. It said Community Development Bank’s acquisition of the deposits was the “least costly” resolution compared to other alternatives.
Friday’s closure was not only the sixteenth U.S. bank failure of 2010 but was also Minnesota’s third bank failure of the year. Regulators last closed the Marshall Bank, N.A. in Hallock on January 29.
- Federal regulators close Minnesota-based bank, twelfth U.S. bank failure of 2010 - Jan 30, 2010
- Federal regulators close Florida-based bank, eleventh U.S. bank failure of 2010 - Jan 30, 2010
- Federal regulators close Ohio-based bank, 31st U.S. bank failure of 2010 - Mar 20, 2010
- Federal regulators close Saint Stephen, Minnesota-based bank, third bank closure of 2010 - Jan 16, 2010
- Federal regulators close Maimi-based bank, fifth bank failure of 2010 - Jan 23, 2010
- Federal regulators close Georgia-based bank, tenth U.S. bank failure of 2010 - Jan 30, 2010
- Federal regulators close Oregon-based bank, ninth U.S. bank failure of 2010 - Jan 23, 2010
- Federal regulators close Seattle-based bank, eighth U.S. bank failure of 2010 - Jan 23, 2010
- New York bank fails in rare Thursday closure, 27th bank failure of 2010 - Mar 12, 2010
- U.S. federal regulators close First International Bank in Texas - Oct 01, 2011
- U.S. federal regulators close 5 banks in 4 states - Apr 28, 2012
- Horizon Bank in Washington marks first bank failure of 2010 - Jan 09, 2010
- New Mexico bank failure is the state's first in more than a decade - Jan 23, 2010
- Spanish bank acquires failed US bank - Aug 22, 2011
- Federal regulators close Texas-based bank, 18th U.S. bank failure of 2010 - Feb 20, 2010
Tags: american state bank, bank failure, benson, bno, closing time, debit cards, department of commerce, deposit insurance corporation, federal deposit insurance, federal deposit insurance corporation, federal deposit insurance corporation fdic, fsb, hancock, minnesota department of commerce, ogema, regulators, service disruptions, state bank, turbulent year, u s bank