Regulators close four banks; two go to TARP recipients

Regulators closed four more banks on Friday, seizing their assets and deposits and placing them with other financial institutions.

Two of the four failed banks were absorbed by companies that had received taxpayer capital through the $700 billion Troubled Asset Relief Program, continuing a trend that BailoutSleuth has been tracking for the past few months.

Of the thirteen banks shut down by regulators since the start of the year, nine were taken over by other institutions whose own balance sheets had been bolstered by the government.

The Florida Office of Financial Regulation closed Riverside Bank of the Gulf Coast, in Cape Coral, Fla. The Federal Deposit Insurance Corp. was appointed as receiver, and it negotiated a purchase agreement with TIB Financial Corp. of Naples, Fla.

Riverside's nine branches will reopen Tuesday as TIB Bank branches. Riverside had $539 million in assets and $424 million in deposits. TIB agreed to pay the FDIC a 1.3 percent premium.

TIB got $37 million in TARP money from the Treasury Department in early December.

The Oregon Division of Finance and Corporate Securities closed Pinnacle Bank in Beaverton, Ore., on Friday. Its lone office and most of its assets were purchased by Washington Trust Bank of Spokane, Wash.

Washington Trust's privately held parent company, W.T.B. Financial Corp., got $110 million in TARP money late last month.

Pinnacle Bank had roughly $73 million in assets and $64 million in deposits. Washington Trust bought $72 million of the assets at a $7.6 million discount. The FDIC and Washington Trust also entered into a loss-sharing arrangement covering $66 million of those assets. The FDIC did not specify the terms of that deal.

The Illinois Division of Banking closed Corn Belt Bank and Trust Co. of Pittsfield, Ill., on Friday. It was taken over by Carlinville National Bank, of Carlinville, Ill.

Corn Belt had $271.8 million in assets and $234.4 in deposits. Carlinville Bank bought $60.7 million of Corn Belt's assets, mainly cash and marketable securities. It assumed all of the banks deposits.

Corn Belt's two offices will reopen Tuesday as Carlinville National branches.

The Nebraska Department of Banking and Finance closed Sherman County Bank of Loup City, Neb., on Friday. Its $85.1 million in deposits and $21.8 million of its assets were taken over by Heritage Bank of Wood River, Neb.

Sherman County Bank's four offices will reopen on Tuesday as Heritage Bank branches.

The FDIC estimated that the latest round of bank failures would cost its insurance fund $341.6 million.