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The Mortgage Graveyard
Failed, closed and a c q u i r e d mortgage-related entities.

2010 Bank Failures Jump Past 100

Recent mortgage-related operations to close or fail

July 25, 2010

By staff

Friday was a deadly day for the U.S. banking sector as regulators in seven states seized seven financial institutions and pushed this year's tally above the century mark. More than $400 million in losses are expected from the failure of the banks, which collectively held more than $2 billion in assets.

The bloodshed began with the seizure of Sterling Bank by the Florida Office of Financial Regulation. The Federal Deposit Insurance Corp. stepped in as receiver of the Lantana, Fla., bank, as is done in the event of any federally insured failure. The Federal Reserve issued a prompt corrective action against Sterling in June and entered a formal agreement with the bank and the state in June 2009.

Sterling's $372 million in deposits were assumed at par by IBERIABANK, which also acquired all of the failed bank's $408 million in assets.

Substantial dissipation of assets and earnings as a result of unsafe and unsound practices led the Office of the Comptroller of the Currency to close down Williamsburg First National Bank in Kingstree, S.C. The federal regulator noted that the bank had incurred losses that depleted its capital, was critically undercapitalized and had no reasonable prospect that it would become adequately capitalized without federal assistance. The OCC entered a formal agreement with Williamsburg in October 2009

Over in Sylvan Grove, Kan., the state's bank commissioner shuttered Thunder Bank. The Federal Reserve Board hit Thunder with a prompt corrective action last month and entered a formal agreement with the bank and parent Thunder Bancorp Inc. in March.

Las Vegas-based SouthwestUSA Bank was closed by the Nevada Financial Institutions Division because of inadequate capital and mounting loan losses. The FDIC issued a prompt corrective action against SouthwestUSA in May and served it with a cease-and-desist order in March.

The Oregon Department of Consumer and Business Services announced the closing of Home Valley Bank, which "was an important part of the Grants Pass community." The state regulator noted that the bank, based in Cave Junction, had seen its capital levels drop to a level of insolvency. The Fed. issued a prompt corrective action against Home Valley this month and entered a formal agreement with the bank and parent Home Valley Bancorp Inc. in November 2009.

Including two other bank failures already reported -- Crescent Bank and Community Security Bank -- 103 FDIC-insured institutions have failed during 2010.

The Dodd-Frank Wall Street Reform and Consumer Protection Act makes the $250,000 deposit insurance limit retroactive to banks that failed between Jan. 1, 2008, and Oct. 3, 2008. The new law impacts former depositors of Hume Bank; ANB Financial, N.A.; IndyMac Bank, F.S.B.; First Priority Bank; The Columbian Bank and Trust Co.; and Silver State Bank.

The National Credit Union Administration said in a statement that it released a corrected second-quarter Call Report for Arrowhead Central Credit Union -- which is operating in conservatorship. The credit union failed on June 25.

"Arrowhead Central had previously posted inaccurate information that distorted the true financial condition of the institution
," NCUA stated. "The corrected statement indicates Arrowhead Central's loan loss reserve increased from $49,520,278 on March 31, 2010, to $53,583,827 as of June 30, 2010."

There have been 127 mortgage-related closings and failure tracked so far this year by

July 24, 2010 Bank Failures
Bank Location Regulator Deposits (mil) Deposit prem. paid Assets (mil) Home Loans (mil) CRE Loans (mil) C&D (mil) Year Founded # Emp Acquirer FDIC Loss-Share Amount (mil) Deposit Ins. Fund Losses (mil)
Community Security Bank New Prague, Minn. Minnesota Department of Commerce $98 million 0.89% $108 million $27 million $24 million $9 million 1997 23 Roundbank $0 million $19 million
Crescent Bank and Trust Co. Jasper, Ga. Georgia Department of Banking & Finance $966 million 1.00% $1,010 million $134 million $259 million $258 million 1989 169 Renasant Bank $617 million $242 million
Home Valley Bank Cave Junction, Ore. Oregon Department of Consumer and Business Services $230 million 1.05% $252 million $69 million $79 million $31 million 1980 59 South Valley Bank & Trust $212 million $37 million
SouthwestUSA Bank Las Vegas Nevada Financial Institutions Division $187 million 0.00% $214 million $17 million $65 million $70 million 2001 33 Plaza Bank $111 million $74 million
Sterling Bank Lantana, Fla. Florida Office of Financial Regulation $372 million 0.00% $408 million $65 million $113 million $59 million 1987 64 IBERIABANK $244 million $46 million
Thunder Bank Sylvan Grove, Kan. Kansas Office of the State Bank Commissioner $29 million 0.00% $32 million $7 million $3 million $3 million 1903 18 The Bennington State Bank $0.00 $5 million
Williamsburg First National Bank Kingstree, S.C. OCC $134 million 0.50% $139 million $25 million $21 million $9 million 1958 46 First Citizens Bank and Trust Company Inc. $64 million $9 million

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