US authorities closed four banks - one in Denver and three in the US Southeast - on Friday with total assets of $2.7 billion, bringing the number of failures in 2011 so far to seven. The pace of bank failures is expected to decrease in 2011 as the economy recovers and the impact of the 2007-2009 financial crisis fades.
In 2010, 157 banks failed, following 140 failures in 2009. FDIC Chairman Sheila Bair has said the agency expects the number of failures to drop in 2011. "You will still have elevated bank failures in 2011 but based on our current projections it will be significantly lower than what we had last year," she said on January 13.
Smaller banks, those with less than a billion dollars in assets, continue to struggle and have made up the bulk of recent closures. Many are having trouble dealing with the sluggish real estate market, particularly its effect on loans they made for commercial property.
The FDIC announced the following closures on Friday: United Western Bank, of Denver. It had assets of $2.05 billion. First Citizens Bank & Trust Company, of Raleigh, North Carolina, will assume the deposits. United Western Bank had eight branches, including in Boulder and Fort Collins.
First Citizens already had three branches in the Denver area operated by its IronStone Bank division. First Citizens has purchased assets of four other banks, in Florida, California and Washington state, in the past 18 months. CommunitySouth Bank and Trust, of Easley, South Carolina. Had $440.6 million in assets. CertusBank, National Association, of Easley, South Carolina, a newly-chartered bank subsidiary of Blue Ridge Holdings Inc, Charlotte, North Carolina, assumed the deposits. Bank of Asheville, North Carolina. It had assets of $195.1 million. First Bank, Troy, North Carolina, to assume the deposits.
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