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Failed-Bank Tally Hits 110 with Illinois Bank’s Closing
Posted By Carrie Bay On August 16, 2010 @ 7:09 am In Government | No Comments
For the second weekend in a row, regulators shut down only one financial institution. It was ""Palos Bank and Trust Company"":http://www.palosbank.com in Palos Heights, Illinois that found regulators at its doors last Friday evening.[IMAGE] It marked the 110th bank failure this year, and the 14th in Illinois, making the state home to the second most collapsed banks in 2010, second only behind Florida.
Palos Bank operated five branch locations, with $467.8 million in deposits and $493.4 million in total assets. ""First Midwest Bank"":http://www.firstmidwest.com of Itasca, Illinois agreed to acquire the failed[COLUMN_BREAK]
institution in an FDIC-assisted transaction. First Midwest said in a statement that it was selected through a competitive bidding process.
First Midwest paid the FDIC a premium of 1.0 percent for Palos Bank's deposits. The FDIC agreed to cover 80 percent of the losses on $343.8 million of the failed bank's assets.
The financial site ""TheStreet.com"":http://www.thestreet.com says that as of June 30, Palos Bank and Trust's ratio of nonperforming assets, including nonaccrual loans, loans past due 90 days or more, and repossessed real estate, made up 14.38 percent of the institution's total assets.
According to the Chicago-area publication the _Southtown Star_, Palos Bank and Trust was told by federal and state regulators last October to raise more capital and strengthen its balance sheet. At the time, the paper said, the FDIC told the bank it was engaging in ""unsafe or unsound banking practices.""
Even with the recent slowdown in closings, the pace of 2010 bank busts is well ahead of the number of failures this time last year Ã¢â‚¬" 77. Since December 2007, the official start of the recession, some 270 banks have been shuttered by regulators.
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