From the FDIC press release:
Covenant Bank & Trust, Rock Spring, Georgia, was closed today by the Georgia Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Stearns Bank, National Association, St. Cloud, Minnesota, to assume all of the deposits of Covenant Bank & Trust. […]
As of December 31, 2011, Covenant Bank & Trust had approximately $95.7 million in total assets and $90.6 million in total deposits. In addition to assuming all of the deposits of the failed bank, Stearns Bank, National Association agreed to purchase essentially all of the assets. […]
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $31.5 million. Compared to other alternatives, Stearns Bank, National Association’s acquisition was the least costly resolution for the FDIC’s DIF. Covenant Bank & Trust is the fourteenth FDIC-insured institution to fail in the nation this year, and the fourth in Georgia. The last FDIC-insured institution closed in the state was Global Commerce Bank, Doraville, on March 2, 2012.
Rock Spring is a town in northwest Georgia, south of Chattanooga.
We’re about to end the 2012 legislative session, in which the state’s leaders made no effort whatsoever to see why Georgia has led the nation in bank failures (and why these Georgia companies have cost the FDIC so many millions of dollars.
This long string of bank failures is an embarrassment to the state, and it won’t go away if we ignore it. There are still dozens of banks in Georgia facing some sort of heightened regulator scrutiny and we will certainly see more failures before all this is over.