Guaranty Bank, Austin, TX was closed today by the Office of Thrift Supervision, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with BBVA Compass, Birmingham, Alabama, to assume all of the deposits of Guaranty Bank, excluding those from brokers.
Guaranty Bank had 103 branches in Texas and 59 branches in California. Former branches of Guaranty Bank will reopen during normal banking hours starting tomorrow as branches of BBVA Compass. Depositors of Guaranty Bank will automatically become depositors of BBVA Compass. Depositors will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branches until BBVA Compass can fully integrate the deposit records of Guaranty Bank.
As of June 30, 2009, Guaranty Bank had total assets of approximately $13 billion and total deposits of approximately $12 billion. In addition to assuming all of the deposits of the failed bank, BBVA Compass agreed to purchase $12 billion of the failed bank’s assets. The FDIC will retain the remaining assets for later disposition.
The FDIC and BBVA Compass entered into a loss-share transaction on approximately $11 billion of Guaranty Bank’s assets.
BBVA Compass will purchase all deposits, except about $344 million in brokered deposits, held by Guaranty Bank.
The FDIC will pay the brokers directly for the amount of their funds.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $3 billion.
Guaranty Bank is the 81st FDIC-insured institution to fail in the nation this year, and the second in Texas.
The last FDIC-insured institution closed in the state was Millennium State Bank of Texas, Dallas, July 2, 2009.
Tags: 2009 Failed Banks, bank failures, BBVA Compass, Failed Banks, Failed Banks 2009, Failed Banks August, Failed Banks August 21, FDIC, Guaranty Bank, Texas
