Over the last year, headlines have detailed the number of failing banks, from the large ones like Washington Mutual (WaMu), which was bought by Chase in September 2008, to smaller ones like Community Bank of Arizona sold in August.
There are at least 130 other banks on the Federal Deposit Insurance Corporation’s (FDIC) failed list.
On Sept. 4, Payson’s First State Bank, joined that list, becoming the 89th institution to fail in the U.S. this year and the third in Arizona.
On Tuesday, the bank reopened its doors, as Sunwest Bank and officials say customers should not notice any changes to their accounts.
“It is going to be business as usual,” said Amy Hill, Payson branch manager.
An e-mail to Glenn Gray, President and Chief Executive Officer of Sunwest Bank, was not returned as of press time.
In early September, the Arizona Department of Financial Institutions closed First State Bank of Flagstaff because it says, “the bank’s financial condition was unsafe and unsound.”
The FDIC accepted receivership of First State Bank and entered into an agreement with Sunwest Bank, under which Sunwest assumed all of First State’s non-brokered deposits and loans totaling approximately $88 million.
The FDIC estimated that the cost to the Deposit Insurance Fund (DIF) would be $47 million.
“Sunwest Bank’s acquisition of all the deposits was the “least costly” resolution for the FDIC’s DIF compared to alternatives.”
First State Bank originally opened in Arizona in September 2008 and had assets totaling $105 million and deposits totaling $95 million.
This is Sunwest’s, a Tustin, Calif. based bank, first branches in Arizona.
“We are pleased with the opportunity to partner with the businesses and residents of Northern Arizona and for Sunwest Bank to become part of the community,” Gray said.
“Sunwest Bank is a strong, well-capitalized and highly liquid community bank. Our new customers can be confident their deposits are safe in a stable bank with more than 40 years of experience and we look forward to serving all their banking needs going forward.”
The FDIC said all depositors of First State Bank will automatically become depositors of Sunwest Bank and they will continue to be insured, “so there is no need for customers to change their banking relationship to retain their deposit insurance coverage.”
Sunwest has been in business for nearly 40 years and at the close of its most recent quarter, its net income grew 20 percent year-over-year for the first half of 2009, and its assets grew by 29 percent during the same period.
“With realistic lending parameters throughout a time when some banks were making irrational loans, our stability gives us the opportunity to help the local businesses and entrepreneurs to grow and expand their businesses. We have protected our depositors’ money, made smart loans, and are now reaping the benefits of that more savvy business conduct,” Gray said