The second half bank failures are in full swing (I missed last week due to vacation. Six banks failed). Today, seven banks were added to the FDIC Failed Bank List:
Sterling Bank, Lantana, FL - $372.4 million in total deposits and an estimated hit to the Deposit Insurance Fund (DIF) of $45.5 million. This deal required a loss-share agreement between the FDIC and IBERIABANK entered on $244.3 million of Sterling Bank’s assets.
Crescent Bank and Trust Company, Jasper, GA - $965.7 million in total deposits and an estimated hit to the DIF of $242.4 million. This deal required a loss-share agreement between the FDIC and Renasant Bank on $617.4 million of Crescent Bank and Trust Company’s assets. All 11 branches will reopen for business on Saturday.
Williamsburg First National Bank, Kingstree, SC - $134.3 million in total deposits and an estimated hit to the DIF of $8.8 million. This deal required a loss-share agreement between the FDIC and First Citizens Bank and Trust Company, Inc. on $64.4 million of Williamsburg First National Bank’s assets.
Thunder Bank, Sylvan Grove, KS - $28.5 million in total deposits and an estimated hit to the DIF of $4.5 million. Nothing particularly special about the deal, which these days is pretty special. This was the 100th bank to fail this year.
Community Security Bank, New Prague, MN - $99.7 million in total deposits and an estimated hit to the DIF of $18.6 million. The bank will reopen Saturday.
SouthwestUSA Bank, Las Vegas, NV - $186.7 million in total deposits and an estimated hit to the DIF of $74.1 million. This deal required a loss-share agreement between the FDIC and Plaza Bank on $111.3 million of SouthwestUSA Bank’s assets.
Home Valley Bank, Cave Junction, OR - $229.6 million in total deposits and an estimated hit to the DIF of $37.1 million. This deal required a loss-share agreement between the FDIC and South Valley Bank & Trust on $211.6 million of Home Valley Bank’s assets.
We’ve now witnessed 103 failures for the year. The FDIC planned on an increased failure rate in the second half, something that appears to be panning out. Even if the financial crisis was truly over, bank failures would continue for some time (they are a lagging indicator). Since I doubt we are even half of the way through this, expect failures for quite some time. Absent another bubble, many local and regional banks are going to struggle.
