Federal regulators shut down two more banks Friday, raising the number of bank failures so far this year to 23.The first bank was Cape Fear Bank in Wilmington, N.C., the first North Carolina bank to fail in nearly 16 years. The other bank was New Frontier Bank of Greeley, Colo., the second Colorado bank this year to collapse. The Federal Deposit Insurance Corp. took over both banks Friday after their respective state regulators closed them down.
The FDIC did not tap a buyer for New Frontier Bank, and instead created the Deposit Insurance National Bank of Greeley. The FDIC named San Francisco-based Bank of the West to manage the entity, which will stay open for about 30 days to give New Frontier Bank's customers time to open accounts at other insured institutions.
New Frontier Bank has $2 billion in assets and $1.5 billion in deposits, $4 million of which potentially exceeded the insurance limits.
The FDIC was able, however, to sell Cape Fear Bank to First Federal Savings and Loan Association of Charleston in Charleston, S.C. On Monday, Cape Fear Bank's eight branches will reopen as First Federal branches. First Federal is assuming all of Cape Fear Bank's $403 million in deposits and buying about $468 million of its $492 million in assets. The FDIC will retain the rest of the assets to sell later.
This year's tally of 23 bank failures is nearing the total for all of 2008, when 25 U.S. banks were seized by regulators. Two of the nation's largest savings and loans failed that year: Washington Mutual Inc. and IndyMac Corp.