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Chicago bank shuttered, makes 3rd failure of 2013

Published on NewsOK Modified: February 15, 2013 at 6:47 pm •  Published: February 15, 2013

WASHINGTON (AP) — Regulators say they have closed a small bank in Chicago, bringing to three the number of U.S. bank failures this year following 51 closures in 2012.

Bank closures also are off to a far slower start. Nine banks had failed by this time last year.

The Federal Deposit Insurance Corp. on Friday seized Covenant Bank, which had about $58.4 million in assets and $54.2 million in deposits as of Dec. 31.

Liberty Bank and Trust Co., based in New Orleans, agreed to assume all of Covenant Bank's deposits and buy essentially all of the failed lender's assets.

The failure of Covenant Bank, which had a single banking branch, is expected to cost the deposit insurance fund $21.8 million.

U.S. bank closures have been declining since they peaked in 2010 in the wake of the financial crisis and the Great Recession.

In 2007 just three banks went under. That number jumped to 25 in 2008, after the financial meltdown, and ballooned to 140 in 2009.

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