Tuesday, March 8, 2011

Cost of local bank closures hits hard

The rise of bank failures nationwide has put a strain on the Deposit Insurance Fund at the Federal Deposit Insurance Corp. Banks support the fund financially through the quarterly premiums they pay to the fund, but the 345 closures to date since 2008 has cost the Deposit Insurance Fund more than $76 billion. In 2009, the FDIC projected bank failures would cost the fund $100 billion by 2014.

Here in Manatee and Sarasota counties, eight banks whose headquarters are based in the bi-county area have failed since 2008. Those bank failures resulted in a combined cost  $948.7 million to the Deposit Insurance Fund. In our Sunday story, "The portrait of a failed bank: First Priority hit hard by risky real estate loans," reporter Duane Marsteller and I examined how practices at First Priority led to its demise -- the first in Manatee during this financial crisis.

Here's how those costs break down by bank:

1. First Priority Bank $72 million
2. Freedom Bank $80 million
3. Community National Bank of Sarasota County $24 million
4.First State Bank of Sarasota $116 million
5. Flagship National Bank $59 million
6. Century Bank F.S.B. $344 million
7. Peninsula Bank $194.8 million
8. Horizon Bank $58.9 million

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