Bank Failure Friday Comes on Thursday - BankUnited - Failure 34 for '09

Usually we get these announcements right after business close on Friday. But today the FDIC announced:

BankUnited, a newly chartered federal savings bank, acquired the banking operations, including all of the nonbrokered deposits, of BankUnited, FSB, Coral Gables, Florida, in a transaction facilitated by the Federal Deposit Insurance Corporation (FDIC). As a result of this transaction, BankUnited, FSB, offices and branches will be operated as BankUnited offices and branches.

BankUnited's 86 offices will be open tomorrow during normal business hours. BankUnited, the successor institution, will be the largest independent bank in Florida, as was its predecessor (BankUnited, FSB). The management team is headed by John Kanas, a veteran of the banking industry and former head of North Fork Bank.

Deposits will be insured by the FDIC. Customers can continue to use BankUnited, FSB's checks, ATM cards and debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

Bank United, FSB had assets of $12.80 billion and deposits of $8.6 billion as of May 2, 2009. The new BankUnited will assume $12.7 billion in assets and $8.3 billion in nonbrokered deposits. The FDIC and BankUnited entered into a loss-share transaction and will share in the losses on approximately $10.7 billion in assets covered under the agreement. The loss-sharing arrangement is projected to maximize returns on the covered assets by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers as they will maintain a banking relationship. BankUnited will recapitalize the institution with $900 million in new capital.

BankUnited will not assume the approximately $348 million in brokered deposits. The FDIC will pay the brokers directly. Customers who placed money with brokers should contact them directly for more information about the status of their deposits.

This is the largest failure this year, costing the FDIC around $5 billion dollars. It is bank failure 34 this year.

RGE has a sorid story on the beyond belief mismanagement of this Coral Cables Florida regional bank. Using keywords like Ponzi in the post.

So glad we pay for the lack of business ethnics and common sense? Me too.

Subject Meta: 

Forum Categories: 

#35 and #36