As of June 25, 2010, the First National Bank of Savannah, Georgia (FNB Savannah) is one of the latest U.S. failed banks. FNB Savannah was closed by the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. Advance notice is not given to the public when a financial institution is closed.
The FDIC updates failed bank information on its website each Friday. FNB Savannah makes the 85th failed bank in the U.S. in 2010 (another bank failed after FNB Savannah, making a total of 86 failed banks in 2010 as of June 25th), and the ninth in the state of Georgia. The last FDIC-insured institution closed in the state was Satilla Community Bank, Saint Mary’s, on May 14, 2010.
All deposit accounts of FNB Savannah, excluding certain brokered deposits, have been transferred to The Savannah Bank, N.A., Savannah, GA, and will be available immediately-depositors of FNB Savannah will automatically become depositors of The Savannah Bank, N.A. The four former FNB locations will reopen as branches of The Savannah Bank, N.A. during regular business hours.
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 First National Bank should continue to use their existing branch until they receive notice from The Savannah Bank, N.A. that it has completed systems changes to allow other The Savannah Bank, N.A. branches to process their accounts as well.
As of March 31, 2010, First National Bank had approximately $252.5 million in total assets and $231.9 million in total deposits. The Savannah Bank, N.A. will pay the FDIC a premium of 0.11 percent to assume all of the deposits of First National Bank. In addition to assuming all of the deposits of the failed bank, The Savannah Bank agreed to purchase some of the assets. As Receiver, the FDIC will retain most of the assets from FNB Savannah for later disposition.
This transaction is unlike most of the FDIC’s loss-share transactions that have been occurring this year. Under loss sharing, the FDIC agrees to absorb a portion of the loss on a specified pool of assets in order to maximize asset recoveries and minimize FDIC losses. With this transaction with The Savannah Bank, there is a less immediate cash need from the FDIC.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $68.9 million. Compared to other alternatives, The Savannah Bank’s acquisition was the “least costly” resolution for the FDIC’s DIF. Customers who have questions about this transaction can call the FDIC toll-free at 1-800-405-1604 during designated hours.
