• Sterns Bank Assumes Deposits of Two Florida Banks
  • August 18, 2009
  • Law Firm: Alston & Bird LLP - Atlanta Office
  • Yesterday, as receiver of two failed Florida banks, First State Bank and Community National Bank of Sarasota County, the FDIC entered into a purchase and assumption agreement with Sterns Bank, N.A., St. Cloud, Minnesota, to assume all the deposits of the failed banks. These closings bring the total number of failed bank’s in the nation this year to 71 and 6  in Florida.

    The Florida Office of Financial Regulation closed First State Bank, of Sarasota, Florida, and Sterns Bank agreed to assume all of First State Bank's deposits (other than approximately $8 million of brokered deposits).  As of May 31, 2009, First State Bank had total assets of $463 million and total deposits of approximately $387 million.  Sterns Bank also agreed to purchase approximately $451 million of First State Bank's assets, with the FDIC retaining the remaining assets for later disposition. The FDIC estimates that the cost to the Deposit Insurance Fund will be $116 million. 

    The OCC closed Community National Bank of Sarasota County and Sterns Bank agreed to assume all of Community National Bank's deposits for a 0.25 percent premium.  As of June 30, 2009, Community National Bank of Sarasota County had total assets of $97 million and total deposits of approximately $93 million.  Sterns Bank also agreed to purchase $94 million of the failed bank’s assets, with the FDIC retaining the remaining assets for later disposition.  The FDIC and Sterns Bank entered into a loss-share transaction on approximately $79 million of Community National Bank’s assets.  The FDIC estimates that the cost to the Deposit Insurance Fund will be $24 million.