Failure Friday – September 18, 2009
Posted by Ray on September 18, 2009 under FDIC, Main | 
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The failures started early today with the FDIC reporting 2 closures, both the same bank, but in teo different states, by 5:00 PM today. These 2 closures means that 94 banks have closed this year, with is astounding. The FDIC is also, basically, broke and is considering getting more cash from the Treasury, they have a $500 billion line of credit and I think they will need a good portion of that in the near future.
On another note, sorry for the lack of posts this week, I am working on a project which is taking a lot of time right now.
Irwin Bank had branches in Kentucky and Ohio, so it was reported weird, but I will use the total number of deposits and assets below.
Bank_____________State____________Assets_______________Deposits
Irwin Union Bank____KY______________$3.1B________________$2.5B
The FDIC estimates a loss of $850 million and entered into a loss-share agreement with First Financial Bank, the acquirer, of $2.5 billion. Basically, we know they lost $850 million for sure, but the FDIC will surely realize some losses on the $2.5 billion loss-share agreement.
The size of the bank closures are getting larger, in case you have not noticed as the closures are not reported on the evening news anymore. I guess the failure of the banking system is somehow not important enough for the news outlets to cover. More later as the closures come in.
Irwin Union Bank:
Federal and state regulators today closed Irwin Union Bank, F.S.B., Louisville, Kentucky, and Irwin Union Bank and Trust Company, Columbus, Indiana, respectively. The institutions are banking subsidiaries of Irwin Financial Corporation, Columbus, Indiana. The regulators immediately named the Federal Deposit Insurance Corporation (FDIC) as the receiver for the banks. To protect depositors, the FDIC entered into a purchase and assumption agreement with First Financial Bank, National Association, Hamilton, Ohio, to assume all of the deposits of the two banks.
Irwin Union Bank and Trust Company, Columbus, Indiana, was closed by the Indiana Department of Financial Institutions. As of August 31, 2009, it had total assets of $2.7 billion and total deposits of approximately $2.1 billion. Irwin Union Bank, F.S.B., Louisville, Kentucky, was closed by the Office of Thrift Supervision. As of August 31, 2009, it had total assets of $493 million and total deposits of approximately $441 million.
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