Regulators closed six more banks on Friday, bringing the total for the year to 130.
The latest casualties included AmTrust Bank of Cleveland, which had $12 billion in assets and is the fourth-biggest bank to fail in 2009. The Federal Deposit Insurance Corp. was appointed as receiver and arranged for New York Community Bank to take over AmTrust's 66 branches, its $8 billion in deposits and $9 billion of its assets.
The FDIC agreed to share losses with New York Community Bank on $6 billion of those assets.
Shares of New York Community Bank's parent company, New York Community Bancorp Inc., jumped in the final hour of trading Friday, and volume surged as well, giving rise to questions about whether some investors had learned of the AmTrust deal early and took advantage of the advance knowledge.
As part of the takeover, Old Westbury-based New York Community Bankcorp gave the FDIC an "equity appreciation instrument'' that will be payable in cash or stock and will have a base value of $25 million.
AmTrust's failure was not unexpected; its parent company filed for bankruptcy earlier in the week, citing effects of the downturn in housing and construction. Although AmTrust was based in Cleveland, it also was a big player in south Florida and other markets.
The other five banks shut down by regulators were Buckhead Community Bank, in Atlanta; First Security National Bank, in Norcross, Ga.; Tattnall Bank, of Reidsville, Ga.; Benchmark Bank, of Aurora, Ill.; and Greater Atlantic Bank, of Reston, Va.
The FDIC arranged for State Bank and Trust Co., of Macon, Ga., to assume Buckhead Community Bank's six branches, its $838 million in deposits and its $874 million in assets. The FDIC and State Bank and Trust entered into a loss-sharing arrangement on $692 million of the failed bank's assets.
State Bank and Trust also acquired the remains of First Security National Bank. It took First Security National's four branches, its $123 million in deposits and $118 million of the bank's $128 million in assets. The FDIC will share losses with State Bank and Trust on $82.4 million of the assets.
HeritageBank of the South, based in Albany, Ga., took over the third seized Georgia institution, Tattnall Bank. HeritageBank took over Tattnall's two branches, its $47.3 million in deposits and nearly all of its $49.6 million in assets.
Of the 130 banks that have gone under this year, 24 were based in Georgia.
MBFinancial Bank of Chicago absorbed Benchmark Bank. It had five branches, $181 million in deposits and $170 million in assets. MBFinancial and the FDIC entered into a loss-sharing deal on $139 million of the assets.
Sonabank, of Mclean, Va., took over Greater Atlantic Bank's five branches, along with its $203 million in deposits and $179 million in assets. The FDIC will share losses with Sonabank on $145 million of those assets.
Unlike many of the FDIC's earlier deals for the remains of failed banks, none of the acquiring institutions this week paid a premium for the deposits they acquired.
The FDIC said the closings would cost its insurance fund an estimated $2.38 billion, with AmTrust representing $2 billion of the total. The FDIC guarantees accounts at failed banks for up to $250,000.
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