US authorities bail out 99th struggling bank
REGULATORS have shut down San Joaquin Bank in California, marking the 99th failure this year of a federally insured bank.
The Federal Deposit Insurance Corporation (FDIC) was appointed receiver of San Joaquin Bank, based in Bakersfield, California. It had $775m (£474m) in assets and $631m in deposits as of September 29.
The FDIC said the bank’s deposits will be assumed by Citizens Business Bank, based in Ontario, California. Its five branches will reopen today as branches of Citizens Business Bank.
San Joaquin Bank’s failure is expected to cost the FDIC’s insurance fund $103m.
Depositors’ money is not in danger. The FDIC is backed by the government, and deposits are guaranteed up to $250,000 per account. The FDIC board recently proposed to have US banks prepay about $45bn of their insurance premiums — three years’ worth.