Regulators like to raid and close banks on Friday afternoons, so today, they closed down Atlanta-based Georgian Bank, making it the 95th bank closure this year.
The failure of this bank will cost the FDIC $892 million, which is quite a lot since the agency’s deposit insurance fund was down to 10.4 billion as of June 30th. Since then, 50 more banks have been closed. It won’t take many more failures like Georgian for the FDIC to end up completely out of money. Of course, they can tap the Treasury’s line of credit to make up for the shortfall, which sounds dangerously close to being something like a bailout.
When it was closed two weeks ago, Corus Bank of Chicago cost the FDIC $1.7 billion. Corus had assets of $7 billion.
Back when it was closed in April, New Frontier Bank of Greeley, Colorado was noted as the largest failure of the year, with assets of $2 billion. It cost the FDIC $670 million. New Frontier has since been left in the dust by the parade of recent closings like Corus and the Irwin Union banks that were closed last week and cost the FDIC $850 million.