First State Bank of Altus, Altus, Oklahoma, was closed today by the Oklahoma State Banking Department, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Herring Bank, Amarillo, Texas, to assume all of the deposits of First State Bank of Altus.
First State Bank of Altus's branches will reopen on Saturday as branches of Herring Bank. Depositors of First State Bank of Altus will automatically become depositors of Herring Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branches until Herring Bank can fully integrate the deposit records of First State Bank of Altus.
Over the weekend, depositors of First State Bank of Altus 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 June 19, 2009, First State Bank of Altus had total assets of $103.4 million and deposits of approximately $98.2 million. In addition assuming all of the deposits of the failed bank, Herring Bank will purchase approximately $64.4 million in assets. The FDIC will retain the remaining assets for later disposition.
Customers who have questions about today's transaction can call the FDIC toll-free at 1-866-674-8944. The phone number will be operational this evening until 9:00 p.m., Central Daylight Time (CDT); on Saturday from 9:00 a.m. to 6:00 p.m., CDT; on Sunday from noon to 6:00 p.m., CDT; and thereafter from 8:00 a.m. to 8:00 p.m., CDT. Interested parties can also visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/fsb-altus.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $25.2 million. Herring Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. First State Bank of Altus is the 65th FDIC-insured institution to fail in the nation this year, and the first in Oklahoma. The last FDIC-insured institution to be closed in the state was American Bank of Commerce, Oklahoma City, on March 26, 1992.
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Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 8,246 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars – insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically (go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information Center (877-275-3342 or 703-562-2200). PR-133-2009