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“The Contagion In Georgia Spreads!”

Two more Georgia banks were seized by the FDIC on Friday!

American Trust Bank in Roswell and North Georgia Bank in Watkinsville were the third and fourth taken-over by the Georgia Department of Banking and turned over to the FDIC this year.

North Georgia Bank was the 55th Georgian bank closed since the crisis began. Illinois also lost its 40th this week. Community First Bank, Chicago was the 14th bank closed in 2011.

With the three foreclosures in Georgia and Illinois the big four, which includes Florida and California, account for 52% of the 333 banks closed since the crisis began. The four states have lost 174 banks in the three years and one month.

The banking crisis shows little sign of slowing as banks continue to have problems with their balance sheets and capital requirements after years of ignoring the fundamentals of finance or suffering from the downturn caused by the Big Banks that were bailed out by the Treasury Department.

As a result the Deposit Insurance Fund of the FDIC continues to be stretched, with expenses outpacing the inputs from member banks.

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”Georgia Still Leading In Foreclosures!”

The FDIC closed four banks on Friday; another in the state of Georgia.

Georgia lost it’s 53rd bank on Friday as the devastation of the Georgia banking system continues unabated. The 52nd Georgian bank was closed just last week.

No buyer was found for Enterprise Banking Company in McDonough so the FDIC closed the bank and created the Deposit Insurance National Bank of McDonough to allow customers access to their insured deposits.

Customers will receive all of their insured funds from the DINB. This allows depositors continuing access to their accounts during the transition.

Enterprise is estimated to cost the Deposit Insurance Fund $39.6 million.

The Carolinas’ each lost a bank last Friday and the fourth take-over was United Western Bank in Denver, Colorado. Neither Colorado nor North Carolina lost banks in 2010 and prior to Friday had only lost three and two respectively since the crisis began back in 2008. South Carolina has now lost five during the crisis.

United Western was the 7th foreclosure this year and the 329th since January, 2008. There were 9 foreclosures at this time last year. It was the largest of the four banks and will cost the DIF $312.8 million of the $454.9 million hit to the Fund this week.

The loss-share story continued with agreements between the FDIC and the three assuming banks totaling nearly $1.5 billion with the Denver agreement over $1.1 billion of that total.

The 2011 foreclosures are on track with last year which had 157 banks seized by the FDIC, 17 more than 2009.

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