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$216 Million Bank Fails

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A Minnesota bank with more than $200 million in assets has gone the way of firms like Washington Mutual Bank and IndyMac Bank. It was the first bank failure in more than a month, but it wasn’t the only recent financial institution casualty.

First Commercial Bank was closed Friday by the Minnesota Department of Commerce.

The bank was founded in 1999 and had around 20 employees at the time of its demise.

Deposits totaled $207 million as of June 30, and total assets of $216 million included $48 million in residential loans, $82 million in commercial real estate loans and $14 million in construction-and-land-development loans.

The Federal Deposit Insurance Corp., which was named receiver, conducted a secret bidding process for the Bloomington, Minn., bank and awarded the winning bid to Republic Bank & Trust Co. in Louisville, Ky. Republic acquired all of First Commercial deposits and assets.

In December, the FDIC issued a notice of intention to prohibit former First Commercial chairman Stuart Voigt from further participation in banking. It also issued a notice of assessment of civil money penalty, findings of fact and conclusions of law, order to pay and notice of hearing.

The FDIC has estimated that the bank failure will cost the Deposit Insurance Fund $64 million.

First Commercial was the 41st FDIC-insured bank failure so far during 2012.

The Michigan Office of Financial Insurance Regulation closed United Catholic Credit Union on Aug. 9 and appointed the National Credit Union Administration as liquidating agent. The state found that the Temperance, Mich., financial institution was operating in an unsafe and unsound manner and was insolvent.

United Catholic had just $303,000 in deposits and less than 300 members. It was the 10th credit union to go down this year.

The latest closings bring to 67 the number of mortgage-related entities tracked by Mortgage Daily that have failed or closed down this year.

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