Five Banks Closed on Nov. 7

2009 Tally Now Stands at 139 Failed Institutions Five more banks were closed by state and federal regulators on Friday, Nov. 7 - the largest of them being United Commercial Bank, an $11.2 billion institution, which now has been acquired by East West Bank.

In all, there now have been 139 failed institutions so far in 2009 - 120 banks and 19 credit unions that have been closed, acquired or placed into conservatorship.

Here is a summary of the latest closings:

United Commercial Bank
United Commercial Bank, San Francisco, California, was closed by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. The FDIC then entered into a purchase and assumption agreement with East West Bank, Pasadena, California, to assume all of the deposits of United Commercial Bank. This agreement included all U.S. branches of United Commercial Bank, the Hong Kong branch of United Commercial Bank, and the subsidiary of United Commercial Bank headquartered in Shanghai, China, United Commercial Bank (UCB-China).

The 63 U.S. branches of United Commercial Bank were to reopen during their normal business hours beginning today as branches of East West Bank. All locations in Hong Kong and China will reopen on Monday, according to normal business hours. In addition, UCB-China, the Shanghai, China, subsidiary of United Commercial Bank, which was also part of the transaction, will continue its regular banking operations without interruption with the full support of its parent company, East West Bank, whose qualification has already passed the preliminary review by the China Banking Regulatory Commission.

As of October 23, 2009, United Commercial Bank had total assets of $11.2 billion and total deposits of approximately $7.5 billion. East West Bank paid the FDIC a premium of 1.1 percent for the right to assume all of the deposits of United Commercial Bank. In addition to assuming all of the deposits of the failed bank, East West Bank agreed to purchase approximately $10.2 billion in assets of the failed bank. As part of the purchase and assumption agreement, the FDIC transferred to East West Bank all qualified financial contracts to which United Commercial Bank was a party and those contracts remain in full force and effect.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $1.4 billion.

Gateway Bank
Gateway Bank of St. Louis, St. Louis, Missouri, was closed by the Missouri Division of Finance, which appointed the FDIC as receiver. The FDIC entered into a purchase and assumption agreement with Central Bank of Kansas City, to assume all of the deposits of Gateway Bank of St. Louis.

The sole branch of Gateway Bank of St. Louis was to reopen on Saturday as a branch of Central Bank of Kansas City. Depositors of Gateway Bank of St. Louis will automatically become depositors of Central Bank of Kansas City.

As of September 25, 2009, Gateway Bank of St. Louis had total assets of $27.7 million and total deposits of approximately $27.9 million. Central Bank of Kansas City did not pay the FDIC a premium for the deposits of Gateway Bank of St. Louis. In addition to assuming all of the deposits of the failed bank, Central Bank of Kansas City agreed to purchase essentially all of the assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $9.2 million.

Prosperan Bank
Prosperan Bank, Oakdale, Minnesota, was closed by the Minnesota Department of Commerce, which appointed the FDIC as receiver. The FDIC then entered into a purchase and assumption agreement with Alerus Financial, National Association, Grand Forks, North Dakota, to assume all of the deposits of Prosperan Bank.

The three branches of Prosperan Bank will reopen during their normal business hours as branches of Alerus Financial, N.A. Depositors of Prosperan Bank will automatically become depositors of Alerus Financial, N.A.

As of August 31, 2009, Prosperan Bank had total assets of $199.5 million and total deposits of approximately $175.6 million. Alerus Financial, N.A. will pay the FDIC a premium of 1.02 percent to assume all of the deposits of Prosperan Bank. In addition to assuming all of the deposits of the failed bank, Alerus Financial, N.A. agreed to purchase approximately $173.9 million of the failed bank's assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $60.1 million.

Home Federal Savings Bank
Home Federal Savings Bank, Detroit, Michigan, was closed by the Office of Thrift Supervision, which appointed the FDIC as receiver. The FDIC then entered into a purchase and assumption agreement with Liberty Bank and Trust Company, New Orleans, Louisiana, to assume all of the deposits of Home Federal Savings Bank.

The two branches of Home Federal Savings Bank will reopen during their normal business hours as branches of Liberty Bank and Trust Company. Depositors of Home Federal Savings Bank will automatically become depositors of Liberty Bank and Trust Company.

As of September 24, 2009, Home Federal Savings Bank had total assets of $14.9 million and total deposits of approximately $12.8 million. Liberty Bank and Trust Company did not pay a premium to assume all of the deposits of Home Federal Savings Bank. In addition to assuming all of the deposits of the failed bank, Liberty Bank and Trust Company agreed to purchase essentially all of the assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $5.4 million.

United Security Bank
United Security Bank, Sparta, Georgia, was closed by the Georgia Department of Banking and Finance, which appointed the FDIC as receiver. The FDIC then entered into a purchase and assumption agreement with Ameris Bank, Moultrie, Georgia, to assume all of the deposits of United Security Bank.

The two branches of United Security Bank will reopen during their normal business hours as branches of Ameris Bank. This includes the branch in Woodstock, Georgia, that operated as the Bank of Woodstock also is part of the transaction. It, too, will re-open as a branch of Ameris Bank. Depositors of United Security Bank will automatically become depositors of Ameris Bank.

As of September 14, 2009, United Security Bank had total assets of $157 million and total deposits of approximately $150 million. Ameris Bank will pay the FDIC a premium of 0.36 percent to assume all of the deposits of United Security Bank. In addition to assuming all of the deposits of the failed bank, Ameris Bank agreed to purchase essentially all of the assets.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $58 million.





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