In yet another sign of the faltering economy, federal and state regulators closed two small Arizona banks yesterday evening, the first institutions headquartered in the state to fail in 2009.
Phoenix-based Community Bank of Arizona and Union Bank in Gilbert were closed, with all deposits of both institutions taken over by MidFirst Bank of Oklahoma City. The daily reports the two banks are the first institutions headquartered in the state to fail in 2009. Read more here.
Community Bank had four branches, and Union Bank had one office. All will open Monday as branches of MidFirst Bank. Both banks were covered by Federal Deposit Insurance Corporation (FDIC) insurance, which protects depositors against loss.
Last July, Seeing Red AZ reported that First National Bank, Arizona’s largest locally based bank and a specialist in lower-quality mortgages, was closed by regulators. Federal banking regulators closed 28 branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California. The banks were owned by Scottsdale-based First National Bank Holding Co.
Also shut down yesterday was Colonial BancGroup Inc., a major lender in real estate development — marking the most significant U.S. bank failure this year — and a small bank in Pennsylvania. The closures boosted to 74 the number of federally insured banks that have failed in 2009, according to an AP report. The FDIC was appointed receiver of the Alabama-based Colonial, with about $25 billion in assets.
Click here to view the 7-page FDIC list of bank closings since October 1, 2000.