Bank regulators closed four Midwestern banks and one in Arizona on Friday, bringing to 89 the number of U.S. banks to fail this year as deteriorating loans continue to take their toll on financial institutions.
The closed banks were Vantus Bank in Sioux City, Iowa, InBank in Oak Forest, Illinois, Platinum Community Bank of Rolling Meadows, Illinois, the First Bank of Kansas City in Missouri and the First State Bank of Flagstaff, Arizona, the Federal Deposit Insurance Corp said.
Vantus Bank was the largest of the five institutions to close, with total assets of $458 million and total deposits of about $368 million.
InBank had total assets of $212 million and total deposits of about $199 million while the First State Bank of Flagstaff, Arizona had total assets of $105 million and total deposits of approximately $95 million as of July 24. The First Bank of Kansas City, which has one branch, had total assets of $16 million and total deposits of about $15 million.
The Office of Thrift Supervision said that Platinum Community Bank had total assets of $148 million while the FDIC estimated its assets as $345.6 million as of August 29, 2009.
The five failures will cost the FDIC deposit insurance fund an estimated $401.3 million, the agency said.
In 2008, 25 U.S. banks were seized by officials, up from only three in 2007.
The insurance fund's balance dipped to $10.4 billion at the end of the second quarter, but that level does not include the additional $32 billion that the FDIC has set aside to cover the cost of bank failures over the next year.
In September, Seattle-based lender Washington Mutual became the biggest bank to fail in U.S. history, suffering from losses from soured mortgages and liquidity problems.
The FDIC will insure up to $250,000 per account at the closed banks.
The agency also has running a tally of problem banks that its examiners closely monitor. At the end of the second quarter, 416 undisclosed institutions were on that list.
FDIC Chairman Sheila Bair has said bank failures will remain elevated even as the economy begins to recover because the bank industry is continuing to recognize loan losses and clean up their balance sheets.
She has said the industry's woes are migrating from residential loans and complex securities to more conventional types of retail and commercial loans that have been hit hard by the recession. (Reporting by Diane Bartz; editing by Carol Bishopric)