WASHINGTON, Sept 10 (Reuters) - Regulators on Friday closed the Horizon Bank, in Bradenton, Fla., with assets of about $187.8 million, lifting the number of U.S. bank failures this year to 119.
Horizon Bank’s four branches will reopen on Monday as branches of Bank of the Ozarks (OZRK.O), the Federal Deposit Insurance Corp said.
Bank of the Ozarks, of Little Rock, Ark., has agreed to purchase essentially all of the assets of the failed bank and to assume all of its deposits.
Horizon Bank had about $164.6 million in total deposits as June 30.
There were no announced bank closings the previous two weeks.
The FDIC and Bank of the Ozarks entered into a loss-share transaction on $150.4 million of Horizon Bank’s assets. Bank of the Ozarks will share in the losses on the asset pools covered under the loss-share agreement.
The FDIC said the transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers, the agency said.
FDIC Chairman Sheila Bair said on Aug. 31 that the agency still anticipates the number of failures this year will exceed the 2009 total of 140, but that total assets of this year’s failures will probably be lower.
Washington Mutual, which had $307 billion in assets when it was seized in September 2008, remains the largest bank to fail during the financial crisis.
It is now mostly smaller institutions that have been collapsing as they deal with problems in the commercial real estate market. Community banks tend to have higher concentrations of these loans than larger banks.
The FDIC, which insures individual accounts up to $250,000, gave an update on the overall health of the banking industry on Aug. 31, saying that while it sees improvements in the industry, the struggling economy continues to be a factor in the reluctance of businesses and consumers to borrow.
Bank earnings for the second quarter were $21.6 billion, an increase from the $17.8 billion recorded in the first quarter.
The number of problem banks continued to rise, however, from 775 to 829, meaning nearly 11 percent of U.S. banks are on the watch list.
The FDIC does not disclose the names of these institutions but the banks on the list are ones regulators have flagged for low capital levels, poorly performing assets or other troubles. (Reporting by Doug Palmer; Editing by Carol Bishopric)