Regulators close 5 banks in 4 states

Associated Press Modified: April 27, 2012 at 9:00 pm •  Published: April 27, 2012
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WASHINGTON (AP) — Federal regulators have closed two banks in Maryland and one each in Minnesota, South Carolina and California, bringing to 22 the number of U.S. banks that have failed so far this year.

The Federal Deposit Insurance Corp. said Friday that it shuttered Bank of Eastern Shore, in Cambridge, Md., as well as HarVest Bank of Maryland, in Gaithersburg.

Regulators also closed Inter Savings Bank in Maple Grove, Minn., Plantation Federal Bank in Pawleys Island, S.C., and Palm Desert National Bank in Palm Desert, Calif.

Combined, the closed banks had $1.42 billion in assets and $1.34 billion in deposits as of Dec. 31.

The FDIC estimates that the banks' failures will cost the insurance fund a combined $272.6 million.

The pace of bank closures has slowed sharply after ballooning following the financial crisis in 2008. By this time last year, 34 banks had failed.

In 2010, regulators seized 157 banks, the most in any year since the savings and loan crisis more than two decades ago. The 2010 failures cost the fund around $23 billion. The FDIC has said that year likely was the high-water mark for bank failures from the Great Recession.

From 2008 through 2010, bank failures cost the fund an estimated $79 billion. Last year, 92 banks failed, costing the fund about $7.9 billion. The FDIC expects failures from 2011 through 2015 to cost $19 billion.

Measured by assets and deposits, Inter Savings Bank was the largest bank among those closed Friday.

The bank, which had four branches and was doing business as InterBank FSB, had about $481.6 million in assets and $473 million in deposits.

Great Southern Bank, based in Reeds Spring, Miss., agreed to assume the assets and essentially all the deposits of Inter Savings Bank. As part of the deal, Great Southern Bank entered a loss-share agreement with the FDIC on $413 million of Inter Savings Bank's assets.

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