The survival of the fittest has definitely played out among banks competing for middle-market business customers, according to more than 6,000 such companies.

With public sentiment running so hard against the banking industry these days the story of Dwelling House Savings and Loan Association, a $13.4 million minority-controlled mutual in Pittsburgh, is nothing short of amazing.Community leaders have rallied around the thrift for the past few months after cyber thieves took more than $3 million through fraudulent automated clearing house transactions, leaving the thrift with a $1 million capital hole.

Regulators closed institutions in five states late Friday, bringing the year's toll to 69 and leaving the FDIC with almost $1 billion more in losses.

SP Acquisition Holdings Inc., a blank check company with $429 million to spend, has agreed to buy the $4 billion-asset Frontier through a share exchange and then recapitalize its bank.

As FSI Group LLC prepared to pour $40 million into Security Bank Corp. last year, it considered what it thought would be the worst-case scenario.

Though the seizure of Security Bank Corp.'s six banks did nothing to change Georgia's reputation as a failure hub, many are calling the resolution the best thing to happen to the state's banking market in years.

A year after posting its first loss, Corus Bankshares is out of capital and out of options. The $7 billion-asset Chicago company reported Friday that it lost $487.3 million in the second quarter, leaving its bank unit with a capital deficit of $157 million.

Despite a second-quarter loss of $43.9 million that left it with a capital shortfall, Integra Bank Corp. in Evansville, Ind., said Friday that it has made progress in dealing with its souring credit quality.

A bill introduced in Congress this week would expand the powers of credit unions to make business loans.

Though its nonperforming loans grew dramatically in the second quarter, Appalachian Bancshares Inc. in Ellijay, Ga., said Thursday that it expects to bring in enough capital to satisfy a regulatory order.

For a year and a half, Taylor Capital Group in Rosemont, Ill., has tried to distinguish the growth of its commercial and industrial lending from the credit problems in its residential real estate portfolio.

After posting its fifth consecutive quarterly loss and falling out of compliance with a regulatory order, Pacific Capital Bancorp said it is weighing "strategic alternatives" — which usually means a company is on the sales block.

The moment a bank anticipates, or sees, signs of nonperformance, it is absolutely essential to meet with the borrower in person and ask the tough questions.

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NEW ENGLAND

With its credit quality increasingly troubled, Midwest Banc Holdings Inc. was already among the relatively small group of banks to defer dividend payments on the government's preferred shares.

A member of the government's watchdog agency on Wednesday said the Small Business Administration should rethink elements of its program to delegate decision-making power to lenders.

First Insurance Funding, a unit of WinTrust Financial, paid $679.5M to become the largest traditional life insurance premium finance lender in North America, it said Tuesday.