U.S. regulators confiscate another 2 banks, engineer sale
2008-07-26 15:35:23 (GMT) (Caymanmama.com - Business News)Tacoma, Washington (CaymanMama.com) – U.S. regulators took over another two banks on Friday and have sold them to Mutual of Omaha Bank. This is the sixth and seventh bank failure this year as financial institutions continue to struggle with the credit crunch and housing bust.
After two weeks of seizing IndyMac Bancorp Inc by the Federal Deposit Insurance Corp, the Controller of the Currency’s office said that it closed the First National Bank of Nevada and the First Heritage Bank NA of California.
First National Bank is characterized as under capitalized with total deposits of $3 billion and assets of about $3.4 billion. First Heritage is described as critically under capitalized with deposits of $233 million and assets of about $254 million as per the regulators.
The FDIC stated that the cost of transactions to insurance funds is estimated at about $862 million keeping in mind that the two banks that have failed represent only 0.3% of the $13.4 trillion of the entire industry assets at approximately 8,500 FDIC insured institutions.
The FDIC also said that the twenty eight offices of these banks will actually re-open on Monday as Mutual Omaha Bank. Over the weekend, customers can access their money through writing checks, debit cards or ATM’s. Mutual of Omaha Bank has about $750 million in assets and operates 14 retail branches in Colorado and Nebraska with commercial lending offices in Des Moines and Dallas, the FDIC said.
It is one of the subsidiaries of Mutual of Omaha that is a 99 year old finance and insurance company with total assets of more than $19 billion.
The top-ranking regulators have actually warned of the additional insolvencies this year and next, but presently, the failure of the size of IndyMac is not expected. It has assets of about $32 billion and deposits of about $19 billion by this March end.
CaymanMama.com - Press Release Distribution Service
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