Bloomberg News

Nebraska, Utah Banks Closed as U.S. Failures This Year Reach 87

November 04, 2011

Nov. 4 (Bloomberg) -- State banking officials shut lenders in Nebraska and Utah and named the Federal Deposit Insurance Corp. as receiver, pushing this year’s U.S. failure count to 87.

Regulators closed Omaha, Nebraska-based Mid City Bank Inc. and SunFirst Bank of Saint George, Utah, according to statements on the FDIC’s website. The two closures drained $62.4 million from the agency’s deposit-insurance fund.

Banks are closing under stress from commercial real estate loans, tied to property values that through April fell about 49 percent from the October 2007 peak, Moody’s Investors Service has said. Since the beginning of 2008, 409 banks have failed.

Purdum State Bank, based in the Nebraska city of the same name, purchased Mid City Bank, according to the FDIC. Purdum added five branches and about $106 million each in assets and deposits. Purdum will change its name to Premier Bank this weekend.

The three offices of SunFirst Bank were purchased by Logan, Utah’s Cache Valley Banking Co., the FDIC said. Cache Valley added almost $170 million in deposits and $177.3 million in assets in the transaction, the FDIC said.

The two failures were the first in each state this year, the FDIC said.

--Editors: Dan Reichl, Paul Tighe

To contact the reporter on this story: Dakin Campbell in San Francisco at dcampbell27@bloomberg.net

To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net.


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