05.31.2011
06.03.2011 update
44 Bank Failures in 2011
original article written by Net Advisor™
As of Friday 05-31-2011, five more banks were seized (failed) and sold to other banks, thus we have 44 bank failures so far in 2011.
The following chart depicts the failed institutions from April 15 to May 27, 2011:
Bank Name |
City |
State |
Cert# |
Closing Date |
2011 Fail# |
| First Heritage Bank | Snohomish | WA | 23626 | May 27, 2011 | #44 |
| Summit Bank | Burlington | WA | 513 | May 20, 2011 | #43 |
| First Georgia Banking Company | Franklin | GA | 57647 | May 20, 2011 | #42 |
| Atlantic Southern Bank | Macon | GA | 57213 | May 20, 2011 | #41 |
| Coastal Bank | Cocoa Beach | FL | 34898 | May 06, 2011 | #40 |
| Community Central Bank | Mount Clemens | MI | 34234 | Apr. 29, 2011 | #39 |
| The Park Avenue Bank | Valdosta | GA | 19797 | Apr. 29, 2011 | #38 |
| First Choice Community Bank | Dallas | GA | 58539 | Apr. 29, 2011 | #37 |
| Cortez Community Bank | Brooksville | FL | 57625 | Apr. 29, 2011 | #36 |
| First National Bank of Central Florida | Winter Park | FL | 26297 | Apr. 29, 2011 | #35 |
| Heritage Banking Group | Carthage | MS | 14273 | Apr. 15, 2011 | #34 |
| Rosemount National Bank | Rosemount | MN | 24099 | Apr. 15, 2011 | #33 |
| Superior Bank | Birmingham | AL | 17750 | Apr. 15, 2011 | #32 |
| Nexity Bank | Birmingham | AL | 19794 | Apr. 15, 2011 | #31 |
| New Horizons Bank | East Ellijay | GA | 57705 | Apr. 15, 2011 | #30 |
| Bartow County Bank | Cartersville | GA | 21495 | Apr. 15, 2011 | #29 |
First Heritage and Summit were both acquired by Columbia State Bank. First Georgia and Atlantic Southern were both acquired by CertusBank. Coastal Bank cruised its way to its new owner, Talmer Bank & Trust. Park Avenue and First Choice Community Banks were both acquired by Bank of the Ozarks. Coastal Bank, Cortez Community and First National Bank of Central Florida were all acquired by Florida Community Bank, a division of Premier American Bank, N.A. Other banks were acquired by separate institutions.
Keep in mind that even though the banks named above were acquired by other institutions, this is done with financial assistance and or loss guarantees by the FDIC.
Reuters reported, “The bulk of the failures have increasingly been smaller institutions, those with less than $1 billion in assets, as large banks have recovered more quickly from the 2007-2009 financial crisis.”
Still a billion dollars in assets per institution is a lot of money. As for whether the big banks have recovered remains to be seen. The larger banks have attempted to sort out their problems; however I still think a couple banks in particular have some work to do.
Bank of America announced that it will begin slashing their $850 Billion in bad loans. It can be attributed that a fair portion of these loans came from B of A’s untimely acquisitions of Countrywide and Merrill Lynch.
Wells Fargo has made improvements but I still think the California real estate market is a foreclosure mecca like Nevada, and what’s left of Michigan.
The problem with banks in California who made mortgages is that property values in this state are higher than in most every other state with exception or relatively on par with New York, and perhaps short of Hawaii. Thus the mortgages in California are significantly greater in dollar terms than most every other state in the country.
What makes this a problem is that the Obama Administration may make banks buy back loans they sold to now defunct Fannie Mae and Freddie Mac. Who knows how big that mess could be, as Fannie and Freddie hold some $5 Trillion in mortgages.
“Like the other big banks, Wells Fargo may be required to buy back bad loans it sold to Fannie Mae, Freddie Mac and other private investors.”
— Source: DealBook/ NY Times, 04-20-2011
The federal government is responsible for demanding banks lower their credit standards so people who could not qualify for traditional home loans, could get them with government guarantees. Now that this government program failed (surprised?) which nearly wiped out all the banks and crashed the global economy in 2008, the government may put the now bad mortgage loans back to the banks.
Arizona is also helping to make mortgage-foreclosure problems more complicated.
“(Arizona bill)…would allow foreclosure sales to be voided if lenders that didn’t originate the loan can’t produce the full chain of title.”
— Source: Bloomberg, 02-23-2011
With state(s) perhaps moving to complicate foreclosures and slow the process of putting homes in the hands of people who can actually pay for them; and with the federal government creating more uncertainty on who will be the actual lender of last resort, housing is likely to remain under pressure.
See the other bank failures and history in our Bank Failure Tracker
Chart Data Source: FDIC
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