[DEBATE] : US shuts down BankUnited FSB in biggest failure this year

[Riaz K Tayob]

[Another one bites the dust, and another one... why does this not make 
news? Is BigMedia up to its old trix again?]


US shuts down BankUnited FSB in biggest failure this year

The Federal Deposit Insurance Corporation headquarters in Washington, 
DC. US regulators on Thursday shut down BankUnited FSB, an ailing 
Florida lender, in the largest American bank failure this year.

US regulators on Thursday shut down BankUnited FSB, an ailing Florida 
lender, in the largest American bank failure this year.

The Federal Deposit Insurance Corporation (FDIC) said the bank’s assets 
had been acquired by a newly chartered federal savings bank, BankUnited.

“BankUnited, the successor institution, will be the largest independent 
bank in Florida, as was its predecessor (BankUnited, FSB),” FDIC said in 
a statement.

BankUnited’s 86 offices will be open Friday during normal business hours.

Bank United FSB had assets of 12.80 billion dollars and deposits of 8.6 
billion dollars as of May 2.

The new BankUnited will assume 12.7 billion dollars in assets and 8.3 
billion dollars in nonbrokered deposits, the statement said.

“The FDIC and BankUnited entered into a loss-share transaction and will 
share in the losses on approximately 10.7 billion dollars in assets 
covered under the agreement,” it said.

The agreement is expected to “minimize disruptions” for loan customers 
as they will “maintain a banking relationship,” it said.

BankUnited will recapitalize the institution with 900 million dollars in 
new capital.

BankUnited, FSB is the 34th FDIC-insured institution to fail in the 
United States this year, and the third in Florida. The last bank to be 
closed in the state was Riverside Bank of the Gulf Coast, Cape Coral on 
February 13.

BankUnited is the second biggest US bank failure during the current 
financial crisis triggered by a home mortgage meltdown, after the 
collapse last July of Indymac, a California mortgage bank.

The FDIC insures deposits at the nation’s 8,305 banks and savings 
associations.