California, Georgia banks are latest to be seized By John Letzing, MarketWatch Feb. 6, 2009
SAN FRANCISCO (MarketWatch) -- Federal regulators shut down a bank in Southern California and another in the Atlanta area on Friday, bringing the number of U.S. failures this year to eight, while marking the 33rd collapse since the recession began.
McDonough, Ga.-based FirstBank Financial Services and Culver City, Calif.-based Alliance Bank were seized, according to the Federal Deposit Insurance Corp.
has agreed to assume all of FirstBank's deposits and purchase roughly $17 million of the failed bank's assets, the FDIC said.
Regions said in a statement that the takeover marks the second time in five months that it's acquired the deposits of a failed bank through arrangements with the FDIC. In August, Regions acquired the deposits and some of the assets of Alpharetta, Ga.-based Integrity Bank, when it was closed by regulators. See related story about Integrity Bank's failure.
FirstBank had total assets of roughly $337 million as of Dec. 31, and $279 million in total deposits, the FDIC said. The FDIC said it will retain FirstBank's remaining assets for later disposition. The FDIC estimated that the cost to its deposit insurance fund as a result of FirstBank's failure will be $111 million.
FirstBank's four offices will reopen Monday as branches of Regions Bank, the FDIC said.
As for California's Alliance Bank, San Diego-based California Bank & Trust has agreed to assume the failed bank's deposits, the FDIC said. Alliance's five offices will reopen Monday as branches of California Bank & Trust. Alliance Bank had $1.14 billion in assets and $951 million in total deposits as of Dec. 31, according to the FDIC.
The agency estimated a $206 million cost to its deposit insurance fund as a result of Alliance Bank's failure. The bank is the second in California to fail this year, following Redlands-based First Centennial Bank on Jan. 23.
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