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Bank Beat---Three Months: 41 Bank Failures




Becoming the sixth bank to fail in Georgia this year, McIntosh Commercial Bank, Carrollton, was closed with CharterBank, West Point, Georgia, to assume all of the deposits.

Formed on November 5, 2002 the four Branches had 59 full time employees and were servicing the Atlanta-Sandy Springs-Marietta areas; previously had six branches, two of which were closed before 2010.
 

Reportedly trouble began at the bank in 2007, and by the end of the following year, losses were evident as 80 percent of their loans were in commercial real estate and development. McIntosh Commercial reported a loss of $19.4 million in 2008 and $8.9 million in 2009. Bank equity had dropped from $17.1 million December 31, 2008 to $8.5 million 2009 and as most of these banks that are being closed now, they had not made a profit in several years. Tier 1 risk-based capital ratio: 3.23%.

As of December 31, 2009, McIntosh Commercial Bank had approximately $362.9 million in total assets and $343.3 million in total deposits. The FDIC and CharterBank entered into a loss-share transaction on $263.1 million of McIntosh Commercial Bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $123.3 million.
http://www.fdic.gov/news/news/press/2010/pr10066.html


 

The sixth bank to fail this year in Florida is Key West Bank, Key West, was closed Friday by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Centennial Bank, Conway, Arkansas, to assume all of the deposits of Key West Bank.

This was a small bank with 16 full time employees that was started February 8, 1999 to specialize in mortgage financing. The equity of the bank had gone from $6.1 million end of year 2008 to $52,000 December 31, 2009.

As an example of its foreclosures, this web site is still up listing 36 real estate properties for sale with addresses, maps, photo’s and details:
http://www.bankermls.com/keywest-bank/property_search
 

The depressed market gave the bank a loss $2.6 million year-end 2008 and loss of $6.5 million in 2009 after a charge off of $5.8 million ($5.2 million in 1-4 residential loans, and the rest in construction and land development.) Tier 1 risk-based capital ratio: 0.09%

As of December 31, 2009, Key West Bank had approximately $88.0 million in total assets and $67.7 million in total deposits The FDIC and Centennial Bank entered into a loss-share transaction on $75.8 million of Key West Bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $23.1 million.
http://www.fdic.gov/news/news/press/2010/pr10067.html

 

Desert Hills Bank, Phoenix, Arizona was closed with New York Community Bank, Westbury, New York, to assume all of the deposits.

The six branches had gone from 125 full time employees to 107 full time employees December 31, 2009. The bank had been expanding its branches recently and got caught in the Arizona over building cycle. Regional and community banks operating in Arizona possess more than $750 million in foreclosed properties, according to Phoenix Business Journal research gathered from data reported to the FDIC.

Desert Hills Bank is another example of the downward spiral of banks, as it had lost $24.3 million 2008 and $8.8 million year-end 2009, after showing a charge off of $16.5 million ($7.4 million construction and land development, $5.8 1-4 family residential property, $2 million commercial and industrial loans, $655,000 nonfarm residential and $522,000 multi-family residential. Equity dropped a small amount, being $23.9 million year-end 2008 to $22.7 million year-end 2008. Tier 1 risk-based capital ratio: 5.80%

As of December 31, 2009, Desert Hills Bank had approximately $496.6 million in total assets and $426.5 million in total deposits. The FDIC and New York Community Bank entered into a loss-share transaction on $325.9 million of Desert Hills Bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $106.7 million
http://www.fdic.gov/news/news/press/2010/pr10069.html

 

Unity National Bank, Cartersville, Georgia was closed Friday with Bank of the Ozarks, Little Rock, Arkansas, to assume all of the deposits. Formed November 30, 1998, the five branches had gone from 86 full time employees December 31, 2008 to 69 December 31, 2009. Net equity dropped from $23.8 million to $9 million the same period, loss of $2 million end of year 2008 to a loss of $15.7 million year-end 2009.

United was heavy into real estate focus, especially residential and commercial development, such as subdivisions and retail strip centers. The bank had a charge off end of year 2009 of $10,297,000 ( $4.12 million 1-4 family residential,$2.2 million commercial loans, $1.9 million construction and land development, $1.4 million nonfarm residential, $500,000 plus to individuals.)Tier 1 risk-based capital ratio: 3.98%

As of December 31, 2009, Unity National Bank had approximately $292.2 million in total assets and $264.3 million in total deposits. The FDIC and Bank of the Ozarks entered into a loss-share transaction on $206.1 million of Unity National Bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $67.2 million.
http://www.fdic.gov/news/news/press/2010/pr10068.html
 

Problem Bank List Grows:
cr4re.com/PBLMar2610.html

List of Bank Failures
www.fdic.gov/bank/individual/failed/bank...

Previous Columns:
http://www.leasingnews.org/Conscious-Top%20Stories/Bank_Beat.htm

 



Disclosure: no positions