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52 branch bank failure in Indiana, plus two more


 

Integra Bank, NA., Evansville, Indiana is the nation's second largest banking failure this year. It is the 61st bank to fail, but the good news is last year the regulators had closed 108 banks by this date.


 

The 52 branches of Integra Bank were closed with Old National Bank, Evansville, Indiana, to assume all of the deposits. This is a very old bank founded July 4, 1850 and survived the depression. Its history shows it helped finance the Erie Canal, but the direction changed dramatically when in 2006 it was acquired by Prairie Financial Group for $122 million and the bank then went on a very aggressive real estate lending spree just as the bubble was about to burst, extremely poor timing.(1)

Prairie Financial Corporation is the holding company of Prairie Bank & Trust Co., an Illinois chartered bank, a relatively small bank. with 20 full time employees with an office in Effingham in Stewardson, Illinois, Its 2010 year-end profit was $270,000 and June 30, 2011 net equity $5.2 million.

Integra Bank had a high of 802 full time employees when purchased by the Prairie Financial Group in 2006, but by March 31, 2011 it had only 516 full time employees with 13 offices in Illinois, 30 in Indiana, and 12 in Kentucky. June 30, 2011 Tier 1 risk-based capital ratio: 1.48%

The numbers below show the bank has had serious problems since 2008. In May, 2009 the Office of the Comptroller took enforcement action, also ordering the bank to raise additional capital of $120 million. It became one of the few remaining large banks unable to repay the $83.6 million TARP money.

As of March 31, 2011, Integra Bank, National Association had approximately $2.2 billion in total assets and $1.9 billion in total deposits. Old National Bank will pay the FDIC a premium of 1.0 percent to assume all of the deposits of Integra Bank, National Association. In addition to assuming all of the deposits of the failed bank, Old National Bank agreed to purchase essentially all of the assets.

The FDIC and Old National Bank entered into a loss-share transaction on $1.2 billion of Integra Bank, National Association's assets.

(in millions, unless otherwise)

Net Equity

 
2006
$288.3
2007
$433.0
2008
$309.1
2009
$196.5
2010
$84.6
3/31
$40.5
6/30
$20.9

Profit

 
2006
$23.5
2007
$36.7
2008
-$106.3
2009
-$175.8
2010
-$115.9
3/31
-$45.0
6/30
-$69.0

Non-Current Loans

 
2006
$8.8
2007
$22.6
2008
$150.9
2009
$214.8
2010
$197.0
3/31
$189.7


 

Charge Offs
2006 $23.5 ($20.5 commercial and industrial loans, $1.3 consumer loans, $984,000 1-4 houses,)
2007 $4.0 ($1.4 consumer loans, $877,000 1-4 fam., $519,000 commercial & industrial
2008 $28.6 ($12.4 L&C, $5.3 commercial & industrial, $3.8 1-4 fam., $2.5 multifamily, $2.2 individuals)
2009 $89.1 ($29.8 L&C, $18.3 other loans, $14.9 1-4 fam., $10 multifam., $5.5 commer, $2.6 indiv.)
2010 $114.5 ($47.9 L&C, $22.1 nonfarm, $19.6 1-4 fam., $11.5 commercial, $7.4 multifam., $3.8 lease financing receivables, $1.2 indiv.)
3/31 $19.9 ($8.2 L&C, $6.2 nonfarm, $3.4 1-4 family, $2 commercial (-$577,000 lease financing receivables. Land and Construction, 1-4 family multiple residential, Multiple Family Residential, Non-Farm Non-Residential loans.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $170.7 million.

(1) Integra expansion proved to be ultimate downfall
www.indianaeconomicdigest.net/main.asp?S...

www.fdic.gov/news/news/press/2011/pr1112...
 




 

The three branches of BankMeridian, N.A., Columbia, South Carolina, were closed with SCBT, National Association, Orangeburg, South Carolina, to assume all of the deposits. Formed May 18, 2006 after raising $31.5 million in capital, the bank had a high of 46 full time employees in 2007, but by March 31, 2011 was down to 34 full time employees at their offices in Columbia, Hilton Head island, and Spartanburg. Tier 1 risk-based capital ratio: 1.88%

It is interesting to note the problembanklist noted that BankMeridian in April, 2009 said it would not participate in the US Treasury's Troubled Asset Relieve Program (TARP.)

"In a press release Bank President Ashley Houser said that although “the bank recognizes the Treasury’s programs are important for strengthening the overall US financial system, the bank’s Board of Directors found the imposed limitations were not in the best interests of shareholders”. President Houser also stated that “Our confidence in our capital position is one of the main reasons that we chose not to participate in the TARP CPP”.
 

Obvious he didn’t know what he was doing as the capital of BankMeridian thereafter quickly vanished as loan defaults continued to soar."
problembanklist.com/bankmeridian-columbi.../

(in millions, unless otherwise)

Net Equity

 
2006
$30.2
2007
$30.7
2008
$29.3
2009
$20.3
2010
$7.7
3/31
$2.98

Profit

 
2006
-$1.3
2007
$302,000
2008
-$1.1
2009
-$8.9
2010
-$12.5
3/31
-$4.8

Non-Current Loans

 
2006
0
2007
0
2008
$5.7
2009
$19.7
2010
$35.6
3/31
$38.4

Charge Offs
2006 0
2007 0
2008 $1.4 ($543 commercial and industrial, $540,000 L&C, $190,000 nonfarm, $170,000 1-4 fam.)
2009 $4.4 ($2.1 commercial and industrial, $1 1-4 fam., $895,000 L&C, $100,000 other loans)
2010 $7.98 ($3 1-4 family homes, $2.6 L&C, $1 commercial and industrial primarily)
3/31 $2.3 ($1 1-4 family homes, $652,000 L&C, $485,000 non farm)

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

As of March 31, 2011, BankMeridian, N.A. had approximately $239.8 million in total assets and $215.5 million in total deposits. The FDIC and SCBT, National Association entered into a loss-share transaction on $179.0 million of BankMeridian, N.A.'s assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $65.4 million.

www.fdic.gov/news/news/press/2011/pr1112...

 


 

Virginia Business Bank, Richmond, Virginia, was closed with Xenith Bank, Richmond, Virginia, to assume all of the deposits. The small bank was founded April 3, 2006 and had a high of 18 full time employees in 2008, but by March 31, 2011 was down to 11 full time employees. March 31, 2011: Tier 1 risk-based capital ratio: 1.13%.

August, 2009 Virginia Business Bank signed a consent decree to "restore and maintain the Bank to a safe and sound condition."

October 10, 2010 regulators informed the state chartered bank, that they were in serious default and had to raise capital, but basically at the same time, the offer to raise $30 million common stock failed, as the numbers certainly were scaring off investors. The bank reportedly became the first state chartered to fail in 20 years.

(in millions, unless otherwise)

Net Equity

 
2006
$14.8
2007
$13.3
2008
$11.5
2009
$9.4
2010
$3.3
3/31
$796,000

Profit

 
2006
-$2.4
2007
-$1.7
2008
-$2.3
2009
-$4.2
2010
-$3.3
3/31
$796,000

Non-Current Loans

 
2006
0
2007
0
2008
$1.1
2009
$6.9
2010
$11.3
3/31
$9.9

Charge Offs
2006 0
2007 0
2008 N/A
2009 $2.5 ($906,000 L&C, $629,000 1-4 Fam., $858,000 commercial and industrial loans)
2010 $5.3 ($3.3 L&C, $1.2 1-4 fam., $1.3 commercial & indust., $1 non-farm, $634,000 indiv.)
3/31 $921,000 ( $585,000 non-farm, $254,000 1-4 famil, $82,000 L&C)

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

As of March 31, 2011, Virginia Business Bank had approximately $95.8 million in total assets and $85.0 million in total deposits.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $17.3 million.

www.fdic.gov/news/news/press/2011/pr1112...
 

Tracking Bank Failures Map:
http://graphicsweb.wsj.com/documents/Failed-US-Banks.html

List of Bank Failures:
http://www.fdic.gov/bank/individual/failed/banklist.html
 

Bank Beat:
http://www.leasingnews.org/Conscious-Top%20Stories/Bank_Beat.htm