While another bank has been forced out of business by regulators, the pace of bank failures has slowed considerably from the peak three years ago. Other recent mortgage casualties include a small credit union and an appraisal management company.
Frontier Bank was seized Friday by the Georgia Department of Banking and Finance, pursuant to the Official Code of Georgia, Section 7-1-150(a), and closed down.
The state regulator is authorized to take possession of a state-chartered bank “whenever such financial institution is either insolvent or operating in an unsafe or unsound condition to transact its business, is operating in violation of any court order, statute, rule or regulation, or requests the department to take possession of its business and property.”
An order was obtained from the Superior Court of Troup County appointing the Federal Deposit Insurance Corp. as receiver .
The LaGrange, Ga., bank had around $259 million in total assets as of Dec. 31, 2012, including $39 million in home loans, $41 million in commercial real estate loans and $18 million in construction-and-development loans. Total deposits stood at $224 million.
The bank was established in 1946 and had 98 employees as of the end of last year. In June 2012, Frontier’s former parent, Frontier National Corp., entered a written agreement with the Federal Reserve Bank of Atlanta.
Stepping in to take over the assets and deposits of the failed bank was HeritageBank.
Losses to the Deposit Insurance Fund stemming from the demise of Frontier are expected to reach $52 million.
Frontier was this year’s fourth federally insured bank failure.
The pace of bank failures has slowed; by this point in 2012, the failed-bank count had already reached 13. In 2010 — the peak year for bank failures during the recent financial crisis — 30 FDIC-insured bank had failed by this time.
On Feb. 19, the Michigan Office of Financial and Insurance Regulation liquidated Amez United Credit Union and appointed the National Credit Union Administration as liquidating agent.
The state took action “after determining the credit union was insolvent and had no prospect for restoring viable operations.”
The Detroit, Mich., credit union was chartered in 1961 to serve Detroit-area members of the Michigan Conference of the African Methodist Episcopal Zion Church.
Amez United had just 158 members and less than $0.2 million in assets.
In all, Mortgage Daily has tracked the failure of three credit unions so far during 2013.
AMC PowerLink Settlement is being wound down, Inside Mortgage Finance reported. The company is reportedly a joint venture between Homeward Residential and Fidelity National Financial.
Year-to-date mortgage-related business closings and failures total nine, according to data collected by Mortgage Daily.
