Second Worst Bank Fails and a Surprise

Second ranked Legacy Bank of Milwaukee, WI was closed by regulators today. It had approximately $190.4 million in total assets and $183.3 million in total deposits. Seaway Bank and Trust Company of Chicago, IL has agreed to assume all deposits. Seaway is second time acquiring bank having previously bought First Suburban National Bank of Maywood, IL. Although not among those banks deemed most risky by The Bank Blog, it should be pointed out that Seaway itself is not without its risks. It most recently received a rank of 434th putting it in the highest decile in terms of risk and struggles with a lower equity ratio than its peers.

The First National Bank of Davis of Davis, OK also closed today. On paper this was a very sound, profitable bank with a ranking of 3381. But just two days ago, the bank's president (and later CEO) since 1993, W.A. "Dub" Moore, was removed by OCC. With an expected cost to the Deposit Insurance Fund (DIF) of $26.5 million one can only surmise that the reported numbers were probably inaccurate. With its acquisition by the Pauls Valley National Bank (5681st) of Pauls Valley, OK chances are we will never know the bank's true state prior to failure. This is the second bank with an apparent fraud to fail since The Bank Blog began reporting.