Another Bank Bites the Dust

California-based 1st Centennial Bank fails
By MarketWatch

Last update: 1:13 a.m. EST Jan. 24, 2009
SAN FRANCISCO (MarketWatch) -- 1st Centennial Bank of Redlands, Calif. was seized by the Federal Deposit Insurance Corp. and state regulators on Friday. It was the third bank failure this year, and brings to 28 the number of banks that have closed since the beginning of the current credit crisis.
First California Bank, based in Westlake Village, Calif., will assume the bank's insured deposits, the FDIC said in a statement.

The six branches of 1st Centennial will reopen on Monday as branches of First California Bank. Depositors of the failed bank will automatically become depositors of First California.
As of Jan. 9, 1st Centennial had total assets of $803.3 million and total deposits of $676.9 million, of which there were approximately $12.8 million that exceeded the insurance limits. 1st Centennial also had approximately $362 million in brokered deposits that are not part of Friday's transaction. The FDIC said it will pay the brokers for the amount of their insured funds.

The FDIC said First California agreed to assume the insured deposits for a 5.29% premium. It will also purchase approximately $293 million of the failed bank's assets. The assets are mainly cash, cash equivalents and marketable securities. The FDIC will retain the remaining assets for later disposition.

The cost to the FDIC's Deposit Insurance Fund is estimated to be $227 million. End of Story

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