Morton Community Bank will purchase all deposits, except about $200 million in brokered deposits, held by Citizens National Bank. The FDIC will pay the brokers directly for the amount of their funds. Customers who place money with brokers should contact them directly for more information about the status of their deposits.
The FDIC and Morton Community Bank entered into a loss-share transaction on approximately $200 million of Citizens National Bank’s assets. Morton Community Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-sharing arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement is expected to minimize disruptions for loan customers.
The FDIC and Midland States Bank entered into a loss-share transaction on approximately $420 million of Strategic Capital Bank’s assets. Midland States Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-sharing arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $173 million. Midland States Bank’s acquisition of all the deposits was the least costly resolution for the FDIC’s DIF compared to alternatives. Strategic Capital Bank is the 35th FDIC-insured institution to fail in the nation this year, and the fourth in Illinois.
However FDIC said: “Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage.”
