Filed under: Bank failures

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ShoreBank successor makes two hires

The successor to failed ShoreBank has added a new director and a new personnel executive.

Urban Partnership Bank of Chicago has tapped Martin Eakes, chief executive of the Center for Responsible Lending, a financial watchdog group based in Durham, N.C., for its board of directors pending regulatory approval.

“Martin has a deep understanding of the unmet financial services needs of the bank’s underserved urban communities and has strong ties to residents, entrepreneurs, and leaders of community organizations,” said William Farrow, CEO of Urban Partnership Bank.
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Troubled Wis. bank in talks with Chicago’s Hovde

From the Wisconsin State Journal | A troubled Wisconsin bank is trying to raise capital, either by bringing in investors or finding a merger partner, and has been talking to Steven Hovde, a Madison native and Chicago area investment banker. A key measure of the financial health of Evergreen State Bank, located in Stoughton, Wis., has fallen sharply in the past several months, and bank officials sent a letter to the more than 100 shareholders warning the stock soon could be worthless.

Ex-Chicago bankers pick up second failed bank

A bank investor group that includes turnaround financier Wilbur L. Ross Jr. and several former PrivateBancorp and MB Financial executives on Friday made its second purchase of a failed bank this year. Get the full story »

BofA to return $500M of seized Lehman deposits

Bank of America was ordered by a U.S. judge to return $500 million of deposits it seized from Lehman Brothers Holdings shortly after Lehman’s bankruptcy. Get the full story »

Report: Aggressive lending doomed Broadway Bank

Signage gets changed in the window at Broadway Bank at 5960 N. Broadway. The bank was seized by the FDIC on Friday, Apr. 21, 2010. (Phil Velasquez/Chicago Tribune)

A regulatory autopsy into the April failure of Chicago’s Broadway Bank, which was owned by the family of failed U.S. Senate candidate Alexi Giannoulias, faulted management for pursuing an aggressive growth strategy in commercial real estate.

A heavy emphasis on such lending was “exacerbated by the bank’s significant emphasis on out-of-territory lending and large borrower relationships,” according to a report released Tuesday by the Federal Deposit Insurance Corp.’s Office of Inspector General.

Although not a primary reason for its failure, the FDIC also cited Broadway’s investments in higher-risk collateralized debt obligations. Get the full story »

Obama appoints former Midwest Banc CEO to post

Roberto Herencia, the former chief executive of Midwest Banc Holdings Inc., has been nominated to serve on the board of directors of the Overseas Private Investment Corp., the Obama administration announced Wednesday.

The OPIC was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas. On its Web site, OPIC says it charges market-based fees for its products and services and therefore operates at no net cost to taxpayers. Get the full story »

FDIC: MB Financial only Broadway Bank bidder

Broadway Bank, the lender once owned by the family of  losing U.S. Senate candidate Alexi Giannoulias, attracted only one bidder when it failed in April, newly released records from the Federal Deposit Insurance Corp. show. Get the full story »

FirstMerit ready for more Illinois bank failures

FirstMerit, the Akron-based bank that has become a Top 20 player in the Chicago area through three recent acquisitions, said it expects the pace of Illinois bank failures to pick up again. Get the full story »

FDIC sues failed Ill. bank’s execs over losses

The FDIC sued 11 former executives and directors at a failed Illinois bank on Monday, part of the regulator’s efforts to recover more than $1 billion of losses in its deposit insurance fund.

The lawsuit accuses former officials at Heritage Community Bank of negligence, gross negligence and breach of fiduciary duty.

The Federal Deposit Insurance Corp is planning to sue more than 50 officers and directors of failed banks to help replenish its deposit insurance fund, a spokesman for the regulator said. Get the full story »

Harris decides not to buy Amcore’s Rockford HQ | Harris Bank has taken a pass on Amcore’s Rockford headquarters, leaving the FDIC holding the seven-story building.

TARP report cites bailout’s risks to public trust

An oversight panel for the government’s Wall Street bailout cited risks to the public trust over the handling of the program, as the special inspector general for the Troubled Asset Relief Program released a quarterly report Monday.

The special inspector general was created to monitor the activities of the Treasury Department involving the program started two years ago to save Wall Street from the financial crisis. Get the full story »

Regulators seize Maywood bank

Regulators have shut down First Suburban National Bank of Maywood, Ill., late Friday and sold its $140 million in deposits to Seaway Bank and Trust Co. of Chicago.

Depositors of the First Suburban National Bank will be protected by the purchase deal with Seaway Bank and Trust. The four branches of First Suburban National Bank will reopen Saturday as branches of Seaway Bank and Trust. Seaway did not pay a premium.
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Park National parent to pay $264 million

A 2009 lawsuit filed against the owner of Chicago-based Park National Bank by a consortium of large banks has ended with a consent judgment requiring it to pay $264.2 million.
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FDIC lowers expected cost of bank failures by $8B

Federal regulators have lowered the estimated cost of bank failures by $8 billion over four years and are proposing no increase in the fees banks pay to replenish the fund that insures deposits. Get the full story »

FDIC ready to take execs of failed banks to court

More than 50 lawsuits against officers and executives of failed banks have been authorized by the Federal Deposit Insurance Corp. as the agency tries to recoup more than $1 billion in losses from the credit crisis, Bloomberg News reported Friday. Get the full story »