Florida Kicks Off '11, Ariz. Bank Also Fails

As the epicenter of bank failures in 2010, Florida gave 2011 its first casualty.

Florida was home to 18% of the 157 failures last year, with 29. Following a two-week hiatus, two banks failed on the first Friday of the new year. The failures had combined assets of roughly $750 million and are expected to cost the Deposit Insurance Fund a total of $106 million.

The Florida Office of Financial Regulation closed the $598.5 million-asset First Commercial Bank of Florida in Orlando. The Federal Deposit Insurance Corp. sold essentially all of the bank's assets to the $858 million-asset First Southern Bank in Boca Raton, Fla. First Southern also agreed to assume $529.6 million of the failed bank's deposits at par.

First Southern and the FDIC entered into a loss-sharing agreement on $484.3 million of the bank's assets. First Commercial's failure is expected to cost the deposit insurance fund $78 million.

First Southern Bancorp Inc. raised $400 million in February 2010 to buy failed banks. The First Commercial deal follows its purchase of the failed $148.6 million-asset Haven Trust Bank Florida in Ponte Vedra Beach in September.

Elsewhere, the Arizona Department of Financial Institutions shuttered the $150.6 million-asset Legacy Bank in Scottsdale.

The $2.5 billion-asset Enterprise Bank & Trust in St. Louis agreed to buy essentially all of Legacy assets and entered into a loss-sharing agreement with the FDIC on $119.8 million of the failed bank's assets. It also assumed the bank's $125.9 million deposits, paying a 1% premium.

Legacy's failure is expected to cost $27.9 million.

This is the third deal that Enterprise Bank, the banking unit of Enterprise Financial Services Corp., has struck in Arizona. In December 2009 it picked up the $40 million-asset Valley Capital Bank in Mesa and in July 2010 it acquired a $260 million pool of assets in the state that were originated by the failed Home National Bank in Blackwell, Okla.

For reprint and licensing requests for this article, click here.
Community banking
MORE FROM AMERICAN BANKER