Bailout recipient Tifton Banking Co. was closed by regulators Friday night, marking the second time in consecutive weeks that a TARP bank has failed.
The bank, based in Tifton, Ga., received $3.8 million in taxpayer aid through the Troubled Asset Relief Program in April 2009. That investment will likely be wiped out due to the bank’s failure.
A total of three banks — two in Georgia and one in Arizona — failed Friday.
Tifton’s failure came a week after regulators closed Pierce Commercial Bank, which received $6.8 million in taxpayer aid through TARP.
Tifton now becomes the sixth TARP recipient to be closed by regulators. A seventh, CIT Group Inc., went through a bankruptcy that wiped out Treasury’s $2.3 billion investment.
Tifton had been current on its quarterly dividends to the Treasury Department until August when, for the first time, it became a TARP “deadbeat” by failing to pay $51,800 owed as a condition of receiving government aid.
The bank, established in 2004, had a single Georgia office, according to FDIC records. It held $151.7 million in deposits and $160.7 million in assets. The bank was struggling at the time of its closure, having lost nearly $9.5 million in the first half of 2010, on top of a $3.3 million loss in 2009.
Friday’s largest failure was Darby Bank & Trust Co. in Vidalia, Ga., which had assets of $654.7 million and total deposits of $587.6 million. That bank had seven offices, all of which were in Georgia.
Darby had net losses of $17.9 million so far this year and lost more than $28.6 million in 2009.
The bank had been under an FDIC consent order since December, and its holding company has been under Federal Reserve enforcement since May.
Both Tifton Banking Co. and Darby Bank & Trust Co. will be taken over by Ameris Bank of Moultrie, Ga.
Also failing Friday was Copper Star Bank in Scottsdale, Ariz. It will be taken over by Stearns Bank National Association, based in St. Cloud, Minn.
The three failures combined will cost the FDIC’s deposit insurance fund an estimated $204.4 million. There have now been 146 bank failures this year, compared with 140 for all of 2009.