WASHINGTON — Federal regulators shut three more banks on Friday, including $2.8 billion-asset TierOne Bank of Lincoln, Neb., a struggling 103 year-old thrift.

The other failures were relatively small: $60.4 million-asset First National Bank of Rosedale, Miss., which was the first collapse in that state in nearly 10 year; and $17 million-asset Arcola Homestead Savings Bank in Illinois.

The failure tally for the year reached 81 and is on track to exceed last year's total of 140.

The three failures on Friday are expected to cost the Deposit Insurance Fund nearly $314 million.

The Office of Thrift Supervision said TierOne had substantial loan losses, negative earnings in 10 of the last 11 quarters and insufficient capital. The bank failed to submit an acceptable capital restoration plan to the agency and its attempts to recapitalize or sell itself were unsuccessful.

Ironically, its $2.2 billion of deposits and most of its assets were bought by Western Bank of Sioux Falls, S.D., which had attempted to buy half of the thrift's branches earlier this year before OTS scuttled the deal. In a decision last month, the OTS said the sale of 32 of the thrift's 69 branches, along with $1.1 billion of deposits for $39 million, would have supplied a temporary capital boost but leave the institution undercapitalized by yearend.

It was the last straw for the thrift, which had been under a prompt-corrective-action directive since March 31. That order gave TierOne until May 31 to find a merger partner or raise enough capital to survive.

Great Western paid the Federal Deposit Insurance Corp. a 1.5% premium to assume all of TierOne's deposits and entered into a loss-sharing agreement on $1.9 billion of its assets.

The FDIC estimated the failure will cost $297.8 million.

Earlier in the evening, the Office of the Comptroller of the Currency shut the First National Bank of Rosedale; its $63.5 million of deposits and most of its assets were sold to Jefferson Bank of Fayette, Miss. Jefferson did not pay a premium to assume the deposits.

The FDIC and Jefferson entered into a loss-sharing agreement on $43.5 million of the failed bank's assets. The agency estimated that failure will cost the Deposit Insurance Fund $12.6 million.

The FDIC was unable to find a buyer for failed Arcola Homestead Savings Bank. The agency will mail checks to customers of the bank, which held $18.1 million in total deposits, all of which appeared to be insured. It was the 12th failure this year in Illinois. The agency estimated the failure's cost at $3.2 million.

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