Regulators Close Bloomington-Based First Commercial Bank
Regulators on Friday closed a small bank in Minnesota, bringing to 41 the number of U.S. bank failures this year.
The Federal Deposit Insurance Corp. seized First Commercial Bank, based in Bloomington. The bank had about $215.9 million in assets and $206.8 million in deposits as of June 30.
Republic Bank & Trust Co., based in Louisville, Ky., agreed to assume First Commercial's deposits and purchase essentially all of the failed bank's assets.
The failure of First Commercial, which had one branch, is expected to cost the deposit insurance fund $63.9 million.
First Commercial is the fourth FDIC-insured institution in Minnesota to fail this year.
U.S. bank closures are running at a slower pace than in 2011. 70 banks had failed by this time last year.
Bank closures have slowed sharply since peaking in 2010 in the wake of the financial crisis. In 2007, just three banks went under. That number jumped to 25 in 2008, after the meltdown, and ballooned to 140 in 2009.
In 2010 regulators seized 157 banks, the most in any year since the savings and loan crisis two decades ago. The FDIC has said 2010 likely was the high-water mark for bank failures from the Great Recession.
From 2008 through 2011, bank failures cost the fund an estimated $88 billion. The deposit insurance fund fell into the red in 2009. But with failures slowing, the fund's balance turned positive in the second quarter of last year. By Dec. 31, it stood at $11.8 billion, according to the FDIC.
The FDIC expects failures from 2012 through 2016 to cost $12 billion.
(Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)