|Three financial institution casualties today bring to 12 the number of federally insured banks to fail so far this year. The failures are projected to cost the bank insurance fund more than $300 million.
The Nebraska Department of Banking and Finance shut down Sherman County Bank in Loup City, Neb., an announcement from the Federal Deposit Insurance Corporation today said.
Heritage Bank in Wood River, Neb., will assume all of Sherman County's $85 million in deposits for a 6 percent premium, according to the FDIC -- which was named receiver. Heritage will also buy $22 million of the failed bank's $130 million in assets.
Sherman County had just $3 million in residential mortgages and $5 million in commercial mortgages.
The FDIC expects its Deposit Insurance Fund to take a $28 million hit as a result of Sherman County's failure.
The 30-employee bank was the 10th FDIC-insured failure this year.
But John Nunn, director of Nebraska's Department of Banking and Finance, cautioned that Sherman County's failure is not indicative of the Nebraska banking sector.
"This is not the tip of an iceberg," Nunn stated in a press release. "This closing was precipitated by circumstances unique to Sherman County Bank."
No. 11 was Riverside Bank of the Gulf Coast in Cape Coral, Fla., which was placed in receivership by the Florida Office of Financial Regulation, FDIC -- which was named receiver -- announced.
Riverside had $424 million in deposits as of Dec. 31, of which $281 million will be assumed by TIB Bank in Naples, Fla., for a 1.3 percent premium. Total assets at yearend were $539 million, of which TIB will purchase $125 million.
As of Sept. 30, 2008, Riverside held $201 million in residential loans, $105 million in construction and development loans and $71 million in commercial mortgages.
FDIC projected its loss on Riverside, which had 114 employees, to be $202 million.
The 12th bank to close this year was Corn Belt Bank and Trust Co., which was closed by the Illinois Department of Financial Regulation. FDIC was also named receiver of the Pittsfield, Ill.-based casualty.
The Carlinville National Bank assumed all but $92 billion in brokered deposits of Corn Belt's total $234 million in deposits as of Dec. 31 for a 1.75 percent premium. It also agreed to acquire $61 million of the 40-employee institution's $272 million in assets.
In addition to $18 million in residential mortgages as of Sept. 30, 2008, Corn Belt owned $53 million in commercial mortgages and $20 million in construction and development loans.
FDIC's hit on Corn Belt is estimated at $100 million.