Alva State Bank & Trust Company, Alva, Oklahoma, Assumes All of the Deposits of The Freedom State Bank, Freedom, Oklahoma
June 27, 2014
Greg Hernandez (202) 898-6984
Cell: (202) 340-4922
The Freedom State Bank, Freedom, 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 Alva State Bank & Trust Company, Alva, Oklahoma, to assume all of the deposits of The Freedom State Bank.
The sole branch of The Freedom State Bank will reopen as a branch of Alva State Bank & Trust Company during its normal business hours. Depositors of The Freedom State Bank will automatically become depositors of Alva State Bank & Trust Company. 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 up to applicable limits. Customers of The Freedom State Bank should continue to use their existing branch until they receive notice from Alva State Bank & Trust Company that it has completed systems changes to allow other Alva State Bank & Trust Company branches to process their accounts as well.
This evening and over the weekend, depositors of The Freedom State 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, 2014, The Freedom State Bank had approximately $22.8 million in total assets and $20.9 million in total deposits. Alva State Bank & Trust Company will pay the FDIC a premium of 1.0 percent to assume all of the deposits of The Freedom State Bank. In addition to assuming all of the deposits of the failed bank, Alva State Bank & Trust Company agreed to purchase approximately $17.7 million of the failed bank's assets. The FDIC will retain the remaining assets for later disposition.
Customers with questions about today's transaction should call the FDIC toll-free at 1-800 894-6802. 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; on Monday from 8 a.m. to 8 p.m., CDT; and thereafter from 9:00 a.m. to 5:00 p.m., CDT. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/freedomstate.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $5.8 million. Compared to other alternatives, Alva State Bank & Trust Company's acquisition was the least costly resolution for the FDIC's DIF. The Freedom State Bank is the 12th FDIC-insured institution to fail in the nation this year, and the second in Oklahoma. The last FDIC-insured institution closed in the state was The Bank of Union, El Reno, on January 24, 2014.
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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 banks and savings associations, 6,730 as of March 31, 2014. 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-50-2014