U.S. Banking Regulators Shut Down 5 Banks

U.S. Federal and state banking regulators shut down five banks, bringing the total number of bank failures this year to 22, the Federal Deposit Insurance Corporation said.

Two of the failed banks were in Maryland. The others were located in Minnesota, South Carolina, and California.
In Maryland, regulators closed down HarVest Bank of Gaithersburg and Bank of the Eastern Shore in Cambridge.
Sonabank in McLean, Va., agreed to take over HarVest Bank, which as of December 31 had $164.3 million in assets and $145.5 million in total deposits.

For the Bank of the Eastern Shore, the FDIC created the Deposit Insurance National Bank of Eastern Shore, which will remain open until May 25 so that customers can access their money and open accounts at other banks. As of December 31, Eastern Shore had $166.7 million in total assets and $154.5 million in deposits.

In Minnesota, the Inter Savings Bank in Maple Grove was closed and will be taken over by Great Southern Bank in Reeds Spring, Missouri. As of the end of December, the bank had $481.6 million in assets and $473 million in deposits.
The Plantation Federal Bank in Pawleys Island, South Carolina, was also shut down on Friday. Its six branches, which had about $486.4 million in assets and $440.5 million in deposits as of December, will be acquired by the First Federal Bank in Charleston, S.C.

Finally, in California, the Pacific Premier Bank in Costa Mesa agreed to take over the failed Palm Desert National Bank of Palm Desert. As of December, Palm Desert had $125.8 million in assets and $122.8 million in deposits.
Altogether, Friday’s bank failures will cost the FDIC’s insurance fund $272.6 million.
Despite the fairly large number of failures on Friday, overall, bank failures have slowed considerably since the 2007-2009 financial crisis.

Earlier this month, FDIC acting Chairman Martin Gruenberg said his agency expects a total of 50 to 60 banks to be closed this year.

In 2010, 157 banks with $92.1 billion in total assets failed while 92 institutions with $34.9 billion in total assets were closed in 2011.

Smaller banks, particularly those with less than $1 billion in assets, have made up the majority of closures the past few years, Reuters reported.