Failures That Couldn't Wait for Friday
May 22, 2013 12:37 PM
Regulators usually shut down banks on Friday nights to minimize disruption. However, no rule says failures have to occur on the sixth day of the week. Here is a look, in pictures, at noteworthy seizures on days other than Friday.
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The Big One
FAILED BANK: Washington Mutual, Seattle
ASSETS: $307 billion
DATE: Thursday, Sept. 25, 2008
WaMu was searching for a rescue, but nearly $17 billion in deposits were yanked in the ten days leading up to the seizure, straining liquidity. WaMu is the largest bank failure in U.S. history.
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(Image: Bloomberg News)
Small Town, Big Fraud
FAILED BANK: First National Bank of Keystone (W.Va.)
ASSETS: $1.1 billion
DATE: Wednesday, Sept. 1, 1999
ASSETS: $1.1 billion
DATE: Wednesday, Sept. 1, 1999
The now infamous bank in a West Virginia coal-mining town was a top performer before fraud involving the securitization of more than $500 million of the bank's loans brought it down. Several employees -- including Chairman Billie Cherry, who was also the town's former mayor -- went to prison.
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Subprime Panic
FAILED BANK: Miami Valley Bank (Lakeview, Ohio)
ASSETS: $87 million
DATE: Thursday, Oct. 4, 2007
ASSETS: $87 million
DATE: Thursday, Oct. 4, 2007
Nervous depositors began yanking their cash en masse as the bank's subprime loans - which made up a third of its assets - soured.
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Jump-start on Summer
FAILED BANK: BankUnited, Coral Gables, Fla.
ASSETS: $12.8 billion
DATE: Thursday, May 21, 2009
ASSETS: $12.8 billion
DATE: Thursday, May 21, 2009
Regulators closed the south Florida lender on Thursday with an eye toward depositor convenience. The private-equity buyers, led by John Kanas, reopened on Friday, the eve of the Memorial Day weekend. The newly formed bank kept the name.
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(Image: Bloomberg News)
Honoring Faith
FAILED BANKS: LibertyPointe Bank (New York) /Public Savings Bank (Huntingdon Valley, Pa.)
ASSETS: $210 million / $47 million
DATE: Thursday, Aug. 18, 2011 / Thursday, March 11, 2010
ASSETS: $210 million / $47 million
DATE: Thursday, Aug. 18, 2011 / Thursday, March 11, 2010
Bank failures take a lot of work, so regulators closed these two banks in Orthodox Jewish communities on Thursdays to avoid the Jewish Sabbath, the day of rest that begins at sundown on Friday.
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Fireworks in Illinois and Texas
FAILED BANKS: Six bank units of Founders Group(Worth, Ill.,) / Millennium State Bank of Texas (Dallas)
ASSETS: $1.4 billion / $118 million
DATE: Thursday, July 2, 2009
ASSETS: $1.4 billion / $118 million
DATE: Thursday, July 2, 2009
Regulators chose Thursday in advance of Independence Day to close the Texas and Illinois banks. Shoddy investments brought down the six Founders units.
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Short Reprieve
FAILED BANK: Central Arizona Bank
ASSETS: $32 million
DATE: Tuesday, May 14
ASSETS: $32 million
DATE: Tuesday, May 14
Capitol Bancorp, led by Joseph Reid, attempted to prevent the seizure of one of its Arizona banks by filing an injunction. The move bought it three days.
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