FDIC Friday: Two More Down
September 19th, 2009Via: AP:
Regulators shut down two banking units of Irwin Financial Corp. Friday, marking the 93rd and 94th failures this year of federally insured banks.
The Federal Deposit Insurance Corp. was appointed receiver of Louisville, Ky.-based Irwin Union Bank FSB and Columbus, Ind.-based Irwin Union Bank and Trust Co.
As of Aug. 31, Irwin Bank FSB had $493 million in assets and $441 million in deposits, while Irwin Union Bank and Trust had $2.7 billion in assets and $2.1 billion in deposits.
The FDIC said Friday both bank’s deposits will be assumed by First Financial Bank in Hamilton, Ohio.
First Financial also agreed to purchase essentially all of the two banks’ assets. The FDIC and First Financial Bank reached a loss-share agreement covering about $2.5 billion of the two banks’ combined assets.
The 27 combined branches of Irwin Union Bank FSB and Irwin Union Bank and Trust will be reopened during their normal business hours beginning Saturday as branches of First Financial Bank.
The FDIC estimates the failure of the two banks will cost its insurance fund about $850 million.
Hundreds more banks are expected to fail in the next few years largely because of souring loans for commercial real estate. The number of banks on the FDIC’s confidential “problem list” jumped to 416 at the end of June from 305 in the first quarter. That’s the highest number since June 1994, during the savings-and-loan crisis.
