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Christopher Menkin
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Christopher "Kit" Menkin is of editor (, an internet trade publication for the finance/leasing industry. He has 41 years experience in the finance/leasing industry as well as being a founder of a commercial regional bank and serving on... More
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  • Bank Failure In Georgia---- Not All Banks Doing Well 0 comments
    Jul 21, 2014 12:22 PM

    The two offices of Eastside Commercial Bank, Conyers, Georgia, were closed with Community & Southern Bank, Atlanta, Georgia, to assume all of the deposits. Founded in November 1, 2005, as of March 30, 2014, the bank had 17 full time employees at its offices in Conyers and Duluth. Year-end 2007, there were 27 full time employees. Tier 1 risk-based capital ratio: 2.52%

    Eastside Commercial Bank is the 13th FDIC-insured institution to fail in the nation this year, and the first in Georgia. The last FDIC-insured institution closed in the state was Sunrise Bank, Valdosta, on May 10, 2013. The state had five bank failures in 2008. It hit 25 in 2009, 21 in 2010, 23 in 2011, and 10 in 2013, making it one of the states with the most bank failures. There were only three in 2013.

    Conyers is the only city in Rockdale County, Georgia, 24 miles east of Atlanta. Most recent census, 2009, reported population of 13,941.

    Zillow has 1271 homes for sale in Conyers

    Black alone 8,794 (58.2%)
    White alone 3,817 (25.3%)
    Hispanic 1,999 (13.2%)
    2 or more races 303 (2.0%)
    Other race alone 148 (1.0%)
    American Indian 28 (0.2%)
    Asian alone 13 (0.09%)

    13 banks located in Conyers

    USA Today reports: "The bank with the highest Texas ratio: Eastside Commercial Bank, in Conyers, Ga., clocking in at 1,030.75%. Second-highest: First City Bank of Florida, in Fort Walton Beach, Fla., with a 639.12% Texas ratio.

    "Georgia has 40 banks with Texas ratios higher than 100%, the most of any state, and Illinois comes in second, with 24. Texas had only two."

    John May was the original President and CEO of Eastside Bank, who told the "" November 30, 2009. "Our problems are largely a result of the slowdown in the residential construction industry that occurred dating back to 2008," he said. "We identified those problems early and took action and have begun to make progress."

    May said that the cease and desist order has had and will continue to have no impact on Eastside Bank's customers.

    "We still have full FDIC coverage. Our customers can still take out loans and make deposits," May said.

    He said the bank had already stopped making loans two years ago to residential construction companies, which represented just a portion of its customer base.

    "We continue to maintain our focus on small- to medium-sized businesses," he said.

    May said Eastside Bank will continue to operate under the guidelines of the cease and desist order until the FDIC re-examines the bank at some yet-to-be-determined date.

    "It's usually a one- to two-year process, but as long as we're compliant with the agreement, then we're fine," he said.

    Charge Offs
    (in millions, unless otherwise)

    2006 0
    2007 0
    2008 $2.8 ($2.76 construction/land development, $84,000 commercial/industrial loans)
    2009 $2.1 ($2.0 constr./land, $85,000 commercial/industrial, $14,000 individuals loans)
    2010 $2.9 ($1.7 constr./land, $827,000 commercial/ind., $409,000 multifamily, $3,000 indiv.)
    2011 $2.6 ($1.3 nonfarm/nonres., $746,000 const./land, $387,000 multifamily, $81,000 1-4 family, $53,000 commercial/industrial)
    2012 $4.3 ($2.3 nonfarm/nonres.,$1.7 construct./land, $126,000 1-4 family, $114,000 multifamily (-$31,000 commercial/industrial)
    2013 $781,000 ($479,000 construct./land, $153,000 nonfarm/nonres., $137,000 multifamily, $23,000, 1-4 family, -$11,000 commercial/industrial)
    3/31 $1.5 ($1.2 commercial/industrial, $269,000 nonfarm/nonres., $24,000 construct./land)

    Construction and Land, 1-4 family multiple residential, Multiple Family Residential, Non-Farm Non-Residential loans.

    (in millions, unless otherwise)

    Non-Current Loans

    2006 0
    2007 0
    2008 $10.4
    2009 $13.7
    2010 $6.1
    2011 $12.5
    2012 $14.0
    2013 $13.8
    3/31 $12.4


    2006 $537,000
    2007 $1.3
    2008 -$2.4
    2009 -$1.3
    2010 -$4.1
    2011 -$5.6
    2012 -$4.6
    2013 -$600,000
    3/31 -$778,000

    Net Equity

    2006 $12.0
    2007 $19.5
    2008 $17.2
    2009 $18.6
    2010 $14.5
    2011 $9.2
    2012 $4.5
    2013 $2.4
    3/31 $1.9

    As of March 31, 2014, Eastside Commercial Bank had approximately $169.0 million in total assets and $161.6 million in total deposits. In addition to assuming all of the deposits of Eastside Commercial Bank, Community & Southern Bank agreed to purchase approximately $104.7 million of the failed bank's assets. In a separate transaction, the FDIC will enter into an agreement with State Bank and Trust Company, Macon, Georgia, to purchase $42.6 million of Eastside Commercial Bank's loans. The FDIC will retain the remaining assets for later disposition.

    The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $33.9 million.

    List of Bank Failures:
    Leasing News Bank Beat:

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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