The South Carolina Board of Financial Institutions closed the five branches of Allendale County Bank, Fairfax, South Carolina on Friday. The FDIC was appointed as the receiver. To protect the depositors, an assumption agreement was made was made with Palmetto State Bank, Hampton, South Carolina.
Depositors will continue to be insured by the FDIC, so Palmetto hopes that customers of Allendale will not change their banking relationships due to the switch. Over the weekend, customers were able to access their money by writing check or by using their ATM/debit cards while the branches were closed, but now it’s business as usual—only under a different name.
As of the end of the year, Allendale had $54.5 million in total assets and $51 million in deposits. Palmetto not only assumed the deposits of the failed bank, but purchased all of the assets.
The FDIC has predicted that the cost to the Deposit Insurance Fund (DIF) for this will be $17.1 million. Palmetto’s acquisition was the least costly option.
This is the sixth FDIC-insured bank to fail this year, but the first in South Carolina. The last bank to close in the state was Carolina Federal Savings Bank in 2012.