FDIC Brokers Deals On Three Bank Failures

Three banks, including Chicago's Corus Bank NA, were closed Friday, the Federal Deposit Insurance Corp. (FDIC) reports. To date, 92 FDIC-insured institutions have been shuttered this year.

Corus Bank was closed by the Office of the Comptroller of the Currency, and the FDIC was named receiver. The FDIC has entered into a purchase and assumption agreement with Chicago-based MB Financial Bank NA to assume all the deposits of Corus Bank.

As of June 30, Corus Bank had total assets of $7 billion and total deposits of approximately $7 billion. MB Financial Bank will pay the FDIC a premium of 0.2% to assume all of the deposits of Corus Bank. In addition to assuming all of the deposits of the failed bank, MB Financial Bank agreed to purchase approximately $3 billion of the assets, composed mainly of cash and marketable securities. The FDIC will retain the remaining assets for later disposition. The FDIC plans to sell substantially all of the remaining assets of Corus Bank in the next 30 days in a private placement transaction.

MB Financial Bank did not acquire Corus' commercial real estate loans or loans and other real estate owned related to Corus' construction lending business, according to an MB Financial Bank statement.

‘This is our third FDIC transaction this year, and we are pleased to provide a safe and secure home at MB for Corus customers,’ says Mitchell Feiger, president and CEO of MB Financial Inc.

Also on Friday, the Minnesota Department of Commerce closed Woodbury, Minn.-based Brickwell Community Bank, and the Washington Department of Financial Institutions closed Lacy, Wash.-based Venture Bank. As of July, 24, Brickwell Community Bank had total assets of $72 million and total deposits of approximately $63 million. CorTrust Bank will pay the FDIC a premium of 0.10% to assume all of the deposits of Brickwell Community Bank.

The FDIC entered into a purchase and assumption agreement with First-Citizens Bank & Trust Co., Raleigh, N.C., to assume all of the deposits of Venture Bank. First-Citizens Bank & Trust also agreed to buy approximately $874 million of the failed institution's assets.

As of July 28, Venture Bank had total assets of $970 million and total deposits of approximately $903 million. The FDIC and First-Citizens Bank & Trust entered into a loss-share transaction on approximately $715 million of Venture Bank's assets.

First-Citizens Bank & Trust will share in the losses on the asset pools covered under the loss-share agreement. The loss-share arrangement is projected to maximize returns on the assets covered by keeping them in the private sector, the FDIC says.

SOURCE: FDIC

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