Bank Failures, Meltdown, Spillover

Number 16: Alpha Bank and Trust


From Housing Wire:

Alpharetta, Georgia-based Alpha Bank and Trust became the latest Friday-afternoon casualty in a growing line of failed banks, with the Federal Deposit Insurance Corp. saying that the Georgia Department of Banking and Finance had closed the bank and named the FDIC receiver. St. Cloud, Minn.-based Stearns Bank will assume all insured deposits at the bank under a purchase and assumption agreement, the FDIC said in a press statement.

Alpha Bank is the nation’s 16th bank failure this year, and like many of the others before it, is a small community banking outfit. As of Sept. 30, 2008, the bank had total assets of $354.1 million and total deposits of $346.2 million. Stearns Bank did not pay the FDIC a premium for the right to assume the failed bank’s insured deposits.

The FDIC said that approximately $3.1 million in uninsured deposits held in approximately 59 accounts exceeded the newly-instituted deposit insurance limit of $250,000; no information on how much would have been uninsured sans recent Congressional action to boost the insurance limit was provided by the FDIC.

In today’s market, anyone who has more than the FDIC limit in any small bank, or arguably any bank at all, deserves to lose that money.


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