noworldsystem.com


8th U.S. Bank Failure This Year

8th U.S. Bank Failure This Year

Reuters
August 1, 2008

WASHINGTON (Reuters) – SunTrust Bank (STINews) has acquired the insured deposits of Florida-based First Priority Bank, the eighth U.S. bank to fail this year as financial institutions grapple with a weak economy and a credit crisis precipitated by falling home prices.

The Federal Deposit Insurance Corp said on Friday that Florida regulators closed the bank, which had $259 million in assets and $227 million in deposits. The FDIC was named receiver.

The cost of the failure to the federal insurance fund is estimated to be $72 million, the FDIC said.

 

FDIC warns four US banks over liquidity

Financial Times
August 1, 2008

The Federal Deposit Insurance Corporation revealed on Friday that it had issued warnings to four small US banks that lacked sufficient reserves to cover potential loan losses.

The cease-and-desist orders issued in June said the four banks needed to raise more capital, expand their loss allowances and better oversee and diversify their loan portfolios. A fifth bank was cited for violating consumer protection laws.

Losses on mortages and other loans have helped bring down eight US banks this year, including one small Florida institution on Friday. Last month, Indymac, a California lender with $32bn in assets, became one of the largest banks to go under in US history. It filed for Chapter 7 bankruptcy protection on Friday.

The banks receiving cease-and-desist orders in June were MetroPacific Bank in Irvine, California; Bank Haven in Haven, Kansas; Clarkston State Bank in Clarkston, Michigan; and Hastings State Bank in Hastings, Nebraska.

Read Full Article Here