FDIC back in action: one Georgia bank closed today

From the FDIC:

Security Exchange Bank, Marietta, 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 Fidelity Bank, Atlanta, Georgia, to assume all of the deposits of Security Exchange Bank.

The two branches of Security Exchange Bank will reopen on Monday as branches of Fidelity Bank. Depositors of Security Exchange Bank will automatically become depositors of Fidelity Bank. [. . .]

As of March 31, 2012, Security Exchange Bank had approximately $151.0 million in total assets and $147.9 million in total deposits. In addition to assuming all of the deposits of the failed bank, Fidelity Bank agreed to purchase essentially all of the assets. [. . .]

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $34.3 million. Compared to other alternatives, Fidelity Bank’s acquisition was the least costly resolution for the FDIC’s DIF. Security Exchange Bank is the 30th FDIC-insured institution to fail in the nation this year, and the fifth in Georgia. The last FDIC-insured institution closed in the state was Covenant Bank & Trust, Rock Spring, on March 23, 2012.

So far today, the FDIC has also shuttered The Farmers Bank of Lynchburg in Lynchburg, TN, and Putnam State Bank in Palatka, FL. Four banks failed last Friday, which makes the last couple of weeks the busiest in a long time for the FDIC.

Click here for the full list of bank failures.

Still, the FDIC is far behind the 2011 pace of closures, which was considerably behind 2010. Georgia continues to lead the nation in bank failures since the economic crisis, but the 5 closed so far this year is far lower than the 23 Georgia banks closed in 2011.

As I have said over and over and over, Georgia’s political leaders have made no visible attempt to understand the role of poor regulation or simply poor enforcement of regulation in Georgia’s banking crisis.