Georgia bank “Integrity” is the 10th U.S. bank to fail

August 30, 2008 by · Leave a Comment
Filed under: Bank Failure, Industry News 

Another one bites the dust….. Funny quote but this is no laughing matter. FDIC said this bank would only affect between $250-350 million dollars. We should expect too see more small regional banks to fail over the coming weeks and months and before this is over we should see a major bank get into trouble as well. Don’t fret, this is a normal part of a free market system. I would be more worried if we did not see any banks go belly-up.

Release:

U.S. regulators on Friday took over Integrity Bank, which became the 10th bank to fail this year as the economy struggles under the weight of falling home prices and the credit crisis.

The Federal Deposit Insurance Corp said Georgia regulators closed the Alpharetta-based bank, which had $1.1 billion in total assets and $974 million in total deposits as of June 30.

The FDIC, which was named receiver, said Regions Bank of Birmingham, Alabama, agreed to pay a 1 percent premium to acquire all of the deposits and buy about $34.4 million of Integrity’s assets. Regions Bank is owned by Regions Financial Corp.

The FDIC estimated the impact of Integrity on the $45.2 billion insurance fund to be between $250 million and $350 million.

FDIC spokesman Andrew Gray said Integrity Bank pursued aggressive loan growth in the metropolitan Atlanta real estate market, especially in the construction loan area.

Falling real estate prices combined with inadequate risk management and poor lending practices led to significant loan losses and erosion of the bank’s capital, Gray said.

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