WASHINGTON — Regulators on Friday shut down two banks in Missouri, three in Puerto Rico, and one each in Michigan and Washington, bringing the number of U.S. bank failures this year to 64.
The Federal Deposit Insurance Corp. took over the banks: Champion Bank of Creve Coeur with $187.3 million in assets; BC National Banks of Butler with $67.2 million in assets; CF Bancorp, based in Port Huron, Mich., with about $1.6 billion in assets; and Frontier Bank, based in Everett, Wash., with $3.5 billion in assets.
The FDIC also seized: Westernbank Puerto Rico, based in Mayaguez, with about $11.9 billion in assets; R-G Premier Bank of Puerto Rico, based in Hato Rey, with around $5.9 billion in assets; and San Juan-based Eurobank, with $2.5 billion in assets.
The failure of CF Bancorp is expected to cost the deposit insurance fund $615.3 million; the failure of Champion Bank is expected to cost $52.7 million; that of BC National Banks, $11.4 million and that of Frontier Bank, around $1.4 billion.
BankLiberty, based in Liberty, Mo., agreed to acquire the deposits and $152.6 million of the assets of Champion Bank, while Community First Bank of Butler, Mo., is acquiring all the assets and deposits of BC National Banks
There were 140 bank failures in the U.S. last year, the highest annual tally since 1992, at the height of the savings and loan crisis. They cost the insurance fund more than $30 billion. Twenty-five banks failed in 2008 and only three succumbed in 2007.
The number of bank failures likely will peak this year and will be slightly higher than in 2009, FDIC Chairman Sheila Bair said recently.
As losses have mounted on loans made for commercial property and development, the growing bank failures have sapped billions of dollars out of the deposit insurance fund. It fell into the red last year, hitting a $20.9 billion deficit as of Dec. 31.
The number of banks on the FDIC's confidential "problem" list jumped to 702 in the fourth quarter from 552 three months earlier, even as the industry squeezed out a small profit. Still, nearly one in every three banks reported a net loss for the latest quarter.
The FDIC expects the cost of resolving failed banks to grow to about $100 billion over the next four years.
The agency mandated last year that banks prepay about $45 billion in premiums, for 2010 through 2012, to replenish the insurance fund.
Depositors' money — insured up to $250,000 per account — is not at risk, with the FDIC backed by the government. Apart from the fund, the FDIC has about $66 billion in cash and securities available in reserve to cover losses at failed banks.