""Oglethorpe Bank"":http://www.oglethorpebank.net/ in Brunswick, Georgia, was shut down by state regulators over the weekend. The FDIC brokered a deal with ""Bank of the Ozarks"":http://www.bankozarks.com in Little Rock, Arkansas to take over the operations of the failed lender.
[IMAGE]The Georgia institution marks the third bank closing of 2011, just two weeks into the new year. Last week, community-based lenders in Florida and Arizona ""were shut down"":http://dsnews.comarticles/florida-and-arizona-banks-become-first-failures-of-2011-2011-01-10. During the 2010 calendar year, 157 banks were closed by regulators â€" the most since 1992, the culmination of the nation’s savings and loan crisis.
Oglethorpe Bank had two branch locations, with $212.7 million in deposits and assets totaling $230.6 million. Bank of the Ozarks did not pay the FDIC a premium for the deposits of Oglethorpe Bank. In addition to assuming all of the failed bank’s deposits, Bank of the Ozarks agreed to purchase essentially all of its assets.
[COLUMN_BREAK]The FDIC and Bank of the Ozarks entered into a loss-share transaction on $173.9 million of Oglethorpe Bank's assets. According to Bank of the Ozarks, the FDIC will reimburse the Arkansas bank 80 percent of the losses incurred on the disposition of covered loans and foreclosed real estate.
The FDIC estimates that the failure of Oglethorpe Bank will cost the agency’s deposit insurance fund $80.4 million.
The FDIC said in a statement that the loss-share agreement is projected to maximize returns on the assets covered by keeping them in the private sector and will also minimize disruptions for loan customers, according to the FDIC.
In the third quarter of 2010, Bank of the Ozarks completed its second and third FDIC-assisted acquisitions of the year and “recognized gains on both acquisitions,†the Arkansas bank said in its latest quarterly earnings statement. On September 10, Bank of the Ozarks ""took over Florida’s Horizon Bank"":http://dsnews.comarticles/florida-lenders-closing-pushes-failed-bank-tally-to-119-2010-09-13, and on July 16, it ""acquired South Carolina’s Woodlands Bank"":http://dsnews.comarticles/regulators-close-doors-on-six-more-community-banks-2010-07-19.
These two transactions, after taxes and acquisition and conversion costs incurred during the third quarter, contributed $8.8 million to net income, or $0.51 to diluted earnings per common share, according to Bank of the Ozarks.
Earlier in the year, on March 26, the Arkansas bank also ""picked up Georgia’s Unity National Bank"":http://dsnews.comarticles/four-banks-shuttered-as-failed-tally-hits-41-2010-03-29, and on December 17, it ""acquired Chestatee State Bank"":http://dsnews.comarticles/regulators-shut-down-six-community-based-lenders-2010-12-20 in Georgia after it collapsed.