Regulators have shut down a community bank based in Chicago which has branches in Detroit. In addition, four California banks and banks in Florida and Virginia were closed boosting to 118 the number of U.S. bank failures this year.
The Federal Deposit Insurance Corporation, or FDIC, seized Chicago-based ShoreBank and entered into a “purchase and assumption” agreement with Urban Partnership Bank, a newly-chartered institution, to assume all of the deposits of ShoreBank.
The 15 branches of ShoreBank, including those in the Detroit-area and Cleveland, will reopen as branches of Urban Partnership Bank.
Those doing business with ShoreBank will automatically become depositors of Urban Partnership Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage. Customers of ShoreBank should continue to use their existing branch until they receive notice from Urban Partnership Bank that it has completed systems changes.
Over the weekend, depositors of ShoreBank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
Customers who have questions about the agreement can call the FDIC toll-free at 1-800-523-8503. The phone number will be operational on Saturday from 9:00 a.m. to 6:00 p.m., CDT; on Sunday from noon to 6:00 p.m., CDT; and thereafter from 8:00 a.m. to 8:00 p.m., CDT.
The FDIC also took over the California banks: Butte Community Bank, based in Chico; Pacific State Bank, based in Stockton; Los Padres Bank, in Solvang; and Sonoma Valley Bank, in Sonoma, Imperial Savings and Loan Association of Martinsville, Va., and two Florida banks: Community National Bank at Bartow and Independent National Bank, in Ocala.
© MMX WWJ Radio, All Rights Reserved. The Associated Press contributed to his report.