To provide interested parties with loss information on its
largest receiverships, the FDIC's Division of Finance (DOF) today
reported projected losses to the Bank Insurance Fund (BIF)
associated with the 50 largest closed institutions based on their
asset value at the failure date. The projections, calculated at
year-end 1993, take into account all current and estimated costs
associated with the resolution transactions, not just the projected
loss on remaining assets.
At year-end 1953, the FDIC had 594 active receiverships with
remaining assets in liquidation of approximately $30 billion. Any
losses associated with the liquidation of the remaining $30 billion
as well as losses from previous liquidation efforts will be shared
on a pro rata basis by the BIF and creditors of the failed
Two of the FDIC's largest receiverships are expected to result
in no losses to the BIF:
Banking subsidiaries of the First City Bancorporation,
Inc., Houston, Texas: The 20 First City Banks are expected to be
resolved at no cost to the BIF. All creditors with valid claims
against the receivership(s) will receive the full principal amount
of their claims along with interest as provided by Texas state law.
Based on the outcome of negotiations between the FDIC and First
City Bancorporation in January 1994, approximately $200 million of
surplus will be distributed to First City Bancorporation, Inc. The
holding company also will receive future distributions based on
proceeds realized from the sale of the remaining receivership
assets, less payments made under the loss-sharing arrangements
between the FDIC and the assuming banks, and other costs and
expenses of the receiverships.
Southeast Bank, N.A., Miami, Florida, and its affiliate,
Southeast Bank of West Florida, Pensacola: No loss to the BIF is
expected on these resolutions. All creditors with valid claims
against the receiverships will receive the full principal amount of
their claims. The projected remaining surplus of $27 million will
be used to pay a portion of the interest on claims as provided by
Florida law. The FDIC is currently reevaluating certain aspects of
this transaction to determine if additional surplus is available to
pay additional interest or make distributions to shareholders.
A table showing the 50 largest institutions or groups of
institutions with their associated losses is attached. Several
institutions on the attachment are shown in a consolidated format.
Based on DOF's current analysis, none of the institutions (with the
exception of First City and Southeast, discussed above) within the
consolidated group will generate sufficient recoveries to allow for
full payment of all creditors.
The FDIC evaluates the losses associated with its active
receiverships on an annual basis. In addition, the FDIC prepares
an extensive annual analysis of aggregate figures for all bank
failures for past years. The Failed Bank Cost Analysis (FBCA)
contains statistical data on bank resolutions and estimated losses
on active FDIC receiverships. The 1993 edition of the FBCA is
expected to be available by mid May, 1994.
For further information of the financial condition of any
active receiverships, contact Alvin E. Kitchen, Deputy Director,
Division of Finance, FDIC, 3501 North Fairfax Drive, Room 7059,
Arlington, VA 22226. For a copy of the FDIC's 1993 FBCA, call the
FDIC Reading Room at (202) 898-8563.