NEW YORK, N.Y. – Regulators have closed two lenders in Illinois and Florida, bringing U.S. bank failures this year to 11 after 24 closures in all of 2013.
The Federal Deposit Insurance Corp. said Friday that it has taken over Valley Bank in Moline, Illinois. The bank had 13 branches, assets of $456.4 million and deposits of $360 million.
Great Southern Bank of Reeds Spring, Missouri, will assume all of the deposits of Valley Bank. It’s the 10th bank to fail this year, and the third in Illinois.
The FDIC also is taking over another Valley Bank, this one based in Fort Lauderdale, Florida. It has four branches, assets of $81.8 million and deposits of $66.5 million. Landmark Bank N.A. of Fort Lauderdale is assuming all of the deposits of Valley Bank. Valley Bank of Fort Lauderdale is this year’s first bank failure in Florida.
The two bank failures are expected to cost the deposit insurance fund $51.4 million and $7.7 million, respectively.
U.S. bank failures have been declining since they peaked in 2010 in the wake of the financial crisis and the Great Recession.
Only three banks went under in 2007. That jumped to 25 in 2008, after the financial meltdown, and ballooned to 140 in 2009.
In 2010, regulators seized 157 banks, the most in any year since the savings and loan crisis two decades ago. The FDIC has said 2010 likely was the high-water mark for bank failures from the recession. They declined to 92 in 2011 and fell to 51 in 2012.
In a strong economy, about four or five banks close annually.
From 2008 through 2011, bank failures cost the deposit insurance fund an estimated $88 billion, and the fund fell into the red in 2009. With failures slowing, the fund’s balance turned positive in the second quarter of 2011.The fund had a $48.9 billion balance as of March 31.
The FDIC has said it expects bank failures from 2012 through 2016 will cost the fund $10 billion.