Two of Georgia's larger community banks were shut down on Friday by federal regulators, boosting the number of failures to 32 since the state's banking crisis began in 2008.
The banks, First National Bank of Georgia in Carrollton and Community Bank and Trust in Cornelia, had large real-estate related losses.
First National was taken over by a newly chartered Georgia institution, Community & Southern Bank. Community Bank & Trust was taken over by SCBT, based in Orangeburg, S.C.
Both banks will reopen this weekend under their new names.
Community & Southern purchased all of First National’s deposits, nearly $758 million, paying a premium of 1.25 percent to the Federal Deposit Insurance Corp. The new bank also agreed to essentially purchase First National’s $833 million in assets, according to the FDIC.
A news release from the FDIC announcing the transaction did not include any additional information about the new bank or its owners.
First National lost $53.6 million through the first three quarters of the year and had another $127 million in delinquent loans on its books, most of which it had given up hope of collecting. The bank’s equity tumbled over the past year from $93 million to just $14 million as losses mounted.
The FDIC estimated the failure will cost its insurance fund $260.4 million.
SCBT acquired Community Bank & Trust's $1.1 billion in deposits and $1.2 billion in assets. It did not pay a premium for the deposits.
Community Bank & Trust lost $64.5 million through the first three quarters of 2009 and had $211 million in troubled loans on its books through September, FDIC records show. Its failure will cost the FDIC's insurance fund $354.5 million.
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