The Federal Deposit Insurance Corp. was appointed receiver of the failed banks: Community Bank of West Georgia, based in Villa Rica, Ga.; Neighborhood Community Bank, located in Newnan, Ga.; Horizon Bank in Pine City, Minn.; MetroPacific Bank in Irvine, Calif.; and Mirae Bank in Los Angeles.
Community Bank of West Georgia had $199.4 million in assets and $182.5 million in deposits as of May 15. Neighborhood Community Bank had $221.6 million in assets and $191.3 million in deposits as of March 31. Horizon Bank had $87.6 million in assets and $69.4 million in deposits as of March 31. MetroPacific Bank had $80 million in assets and deposits of $73 million as of June 8. Mirae Bank had $456 million in assets and $362 million in deposits as of May 29.
The two closures in Georgia brought to 14 the number of banks in Georgia that have failed since the beginning of last year, more than in any other state. Most of the failures have involved banks in the Atlanta area, where the collapse of the real estate market brought economic dislocation.
CharterBank, based in West Point, Ga., agreed to assume all of the deposits of Neighborhood Community Bank and to purchase about $209.6 million of the assets; the FDIC will retain the remaining assets for later disposition. Neighborhood Community's four offices will reopen as branches of CharterBank.
The FDIC said it will mail checks to Community Bank of West Georgia depositors for the amounts of their insured funds. Direct deposits from the government, such as Social Security and veterans' benefits, will be transferred to United Community Bank in Blairsville, Ga.
All of the deposits at Horizon Bank will be assumed by St. Cloud, Minn.-based Stearns Bank NA. Stearns Bank also agreed to purchase $84.4 million of Horizon Bank's assets. The FDIC will retain the remaining assets for later disposition. Horizon Bank's two offices will reopen Saturday as branches of Stearns Bank, and customers accounts will automatically be transferred to Stearns Bank.
Nearly all of MetroPacific Bank's deposits will be assumed by Tustin, Calif.-based Sunwest bank. Only about $6 million in brokered deposits will not be absorbed by Sunwest. The FDIC will pay brokers directly for the amount of those funds. Virtually all of MetroPacific Bank's assets are being purchased by Sunwest Bank. MetroPacific Bank's lone office will reopen Monday as a branch of Sunwest Bank. Deposits will be automatically transferred to Sunwest Bank.
Los Angeles-based Wilshire State Bank will assume all of Mirae Bank's deposits and $449 million of its assets. The remaining assets will be retained by the FDIC for later disposition. Mirae Bank's five offices will be reopened Monday as branches of Wilshire State Bank.
The 45 banks closed nationwide this year compare with 25 in all of 2008 and three in 2007.
The FDIC estimates that the cost to the deposit insurance fund from the failure of Community Bank of West Georgia will be $85 million. CharterBank's failure will cost the fund $66.7 million. The failure of Horizon Bank is expected to cost the fund $33.5 million, while the closure of MetroPacific Bank will cost the fund about $29 million. Mirae Bank's failure will cost the fund $50 million.
As the economy has soured, with unemployment rising, home prices tumbling and loan defaults soaring, bank failures have cascaded and sapped billions out of the deposit insurance fund. It now stands at its lowest level since 1993, $13 billion as of the first quarter.
