NAPLES — Bank closings for the year hit 100 on Friday when federal regulators shut down Partners Bank in Naples.
And on the same day, state financial regulators closed a second Naples bank.
Financial institutions nationwide, including several in Southwest Florida, have collapsed under the weight of soured real estate loans and the Great Recession.
Friday, the Federal Deposit Insurance Corp. (FDIC) took over Partners Bank with $68.7 million in assets and $63.4 million in deposits. Stonegate Bank, based in Fort Lauderdale, agreed to buy the deposits and assets of Partners Bank.
Federal regulators two months ago hit Partners with a cease-and-desist order. The federal Office of Thrift Supervision issued the order Aug. 21, saying the bank needed to raise more capital, stop unsafe or unsound practices and correct any violations of law.
Robert Sudbrook, Partners president and CEO, told the Daily News on Sept. 1 that the bank was trying to raise capital in the 1 1⁄2 years he had been there.
“We have endeavored to do that,” he said at the time.
Partners had hoped to merge with Semoran Financial Corp., a bank development in Orlando, earlier this year. The deal, announced in May, was expected to bring $7.5 million to the Naples bank but it fell apart when Semoran failed to raise the money by July 31.
Semoran could only come up with $5 million, Sudbrook said.
“We are not unique,” he told the Daily News. “A great many other banks in the country are looking to raise capital.”
In a separate action Friday, the Florida Office for Financial Regulation closed Hillcrest Bank Florida in Naples.
The FDIC was appointed as the receiver and Stonegate Bank also will assume all of Hillcrest bank’s deposits.
The six branches of Hillcrest Bank Florida will reopen Monday as branches of Stonegate.
During the weekend, depositors still can access their money and checks will continue to be processed.
Loan customers should continue to make their payments.
As of Oct. 1, Hillcrest had total assets of $83 million and total deposits of about $84 million. Stonegate has agreed to purchase $28 million of the failed bank’s assets. The rest will be disposed of later by the FDIC.
Customers with questions can call the FDIC at 1-(800)-517-1846 or go to http://www.fdic.gov/bank/individual/failed/hillcrest-fl.html.
The FDIC estimates that the cost of the closing to the Deposit Insurance Fund will be $45 million.
Hillcrest Bank Florida became the 102nd FDIC-insured institution to fail in the nation this year, and the eighth in Florida.
Nationally, the 100-plus failures are the most in a year since 1992 at the height of the savings-and-loan crisis. They have cost the federal deposit insurance fund about $25 billion so far this year, and hundreds more bank failures are expected to raise the cost to around $100 billion through 2013.
Depositors’ money isn’t in danger. The FDIC is backed by the government, and deposits are guaranteed up to $250,000 per account. But the deposit insurance fund has fallen into the red.
The 100-plus bank failures this year compares with 25 last year and three in 2007. It’s the highest number in a year since 1992 during the savings-and-loan crisis, when 120 institutions collapsed. Closures peaked during that crisis in 1989, when 534 banks were shuttered.
The most severe financial crisis since the 1930s has hit banks large and small. With unemployment rising, consumer spending slack and businesses shuttered, experts say up to 400 more banks could fail in the next couple of years.
Banks have been especially hurt by failed real estate loans. Banks that had lent to seemingly solid businesses are suffering losses as buildings sit vacant.
As development projects collapse, builders are defaulting on their loans.
The 100 failures may not fully reflect the depth of banks’ travails.
Many more banks — perhaps hundreds — are so weak they could have been shut down already, experts say. Many vulnerable banks are in limbo. Regulators have threatened to close them unless they shore up their balance sheets, but the recession has made it difficult to raise capital or sell assets.
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Customers who have questions can call the FDIC toll-free at 1-800-357-7599. The phone number will be operational from 9 a.m. to 6 p.m. Saturday and from noon to 6 p.m. Sunday. Thereafter, the line is operational from 8 a.m. to 8 p.m. For more information, go to fdic.gov/bank/individual/failed/partners-fl.html.
■ Stonegate Bank: https://www.stonegatebank.com/
■ Partners Bank: http://www.partnersbank.net/
■ Hillcrest Bank Florida: http://www.hillcrestbankfl.com/
■ FDIC Bank Closing Information for Partners Bank: http://www.fdic.gov/bank/individual/failed/partners-fl.html
■ FDIC Bank Closing Information for Hillcrest Bank Florida: http://www.fdic.gov/bank/individual/failed/hillcrest-fl.html