WASHINGTON — Illinois state regulators closed $88.9 million-asset Waukegan Savings Bank, the fortieth failure of the year nationwide and the sixth in the state.

First Midwest Bank of Itasca, Illinois, agreed to purchase all of Waukegan's $77.5 million of deposits and most of its assets.

Despite the bank's small size, its failure is projected to be relatively costly. The Federal Deposit Insurance Corp. estimated Waukegan's collapse would cost $19.8 million, equivalent to 22% of the bank's assets.

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