Regulators closed three banks Friday, including the largest bank subsidiary of bankrupt Advanta Corp., to bring the year's failure toll to 33.
The failure of $1.6 billion-asset Advanta Bank Corp. was anticipated following the November collapse of its parent, which specialized in small-business credit cards. The failure occurred as another subsidiary of the company, $10 million-asset Advanta Bank in Delaware, is embroiled in a court fight with the Federal Deposit Insurance Corp. over agency attempts to hit it with an enforcement order.
The failure's cost to the FDIC equaled nearly 40% of its assets. The FDIC said it could not find a buyer for the Draper, Utah-based institution. Depositors will receive their insured funds — totaling about $1.5 billion — directly. The bank had only about $247,000 in uninsured deposits. The resolution was estimated to cost $636 million.
Meanwhile, the Office of the Comptroller of the Currency closed $70 million-asset American National Bank in Parma, Ohio. The National Bank and Trust Co. in Wilmington, Ohio, purchased all of its $67 million in deposits and roughly all of its assets. The acquirer and the FDIC will share losses on about $50 million of those assets. The resolution was estimated to cost the government $17 million.
Georgia state regulators closed $96 million-asset Century Security Bank in Duluth, Ga. Bank of Upson in Thomaston agreed to assume all of its $94 million in deposits and acquire essentially all of its assets. The FDIC will share losses on $81 million of those assets with the acquirer. The resolution was estimated to cost $30 million.
