Feds close Lutherville's Bay National Bank
Ten-year-old Bay National Bank was closed by federal regulators this afternoon and will reopen its branches on Monday as Bay Bank, the FDIC said. It'll cost the Deposit Insurance Fund $17 million. This is the first Maryland bank closure in a few months but the fourth in two years. Says the agency:
Depositors of Bay National Bank will automatically become depositors of Bay Bank, FSB. 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 Bay National Bank should continue to use their existing branch until they receive notice from Bay Bank, FSB that it has completed systems changes to allow other Bay Bank, FSB branches to process their accounts as well.
Here is the entire statement from the FDIC:
Bay Bank, FSB, Lutherville, Maryland, Assumes all of the Deposits of Bay National Bank, Baltimore, MarylandFOR IMMEDIATE RELEASE
July 9, 2010 Media Contact:
LaJuan Williams-Young
(202) 898-3876
Email: Lwilliams-young@fdic.gov
Bay National Bank, Baltimore, Maryland, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Bay Bank, FSB, Lutherville, Maryland, to assume all of the deposits of Bay National Bank.
The two branches of Bay National Bank will reopen on Monday as branches of Bay Bank, FSB. Depositors of Bay National Bank will automatically become depositors of Bay Bank, FSB. 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 Bay National Bank should continue to use their existing branch until they receive notice from Bay Bank, FSB that it has completed systems changes to allow other Bay Bank, FSB branches to process their accounts as well.This evening and over the weekend, depositors of Bay National Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of March 31, 2010, Bay National Bank had approximately $282.2 million in total assets and $276.1 million in total deposits. Bay Bank, FSB did not pay the FDIC a premium for the deposits of Bay National Bank. In addition to assuming all of the deposits of the failed bank, Bay Bank, FSB agreed to purchase essentially all of the assets of the failed bank.
Customers who have questions about today's transaction can call the FDIC toll-free at 1-800-323-6111. The phone number will be operational this evening until 9:00 p.m., Eastern Daylight Time (EDT); on Saturday from 9:00 a.m. to 6:00 p.m., EDT; on Sunday from noon to 6:00 p.m., EDT; and thereafter from 8:00 a.m. to 8:00 p.m., EDT. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/baynatlmd.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $17.4 million. Compared to other alternatives, Bay Bank, FSB's acquisition was the "least costly" resolution for the FDIC's DIF. Bay National Bank is the 87th FDIC-insured institution to fail in the nation this year, and the second in Maryland. The last FDIC-insured institution closed in the state was Waterfield Bank, Germantown, on March 5, 2010.
Comments
The bank examiners can only hit one city each weekend. Expect more closures by Monday morning
Posted by: Jorge | July 10, 2010 10:16 AM