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Florida Leads Nation In Bank Failures

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Money Generic

The year 2010 will go down in the record book for Florida’s banking industry – and not in a good way.

According to the Federal Deposit Insurance Corp. last year Florida led the nation in bank failures with 29 banks closing their doors. Georgia came in second with 21 failures; nationwide 157 banks closed their doors.

The most recent failure was two weeks ago, according to CBS4 news partner The Miami Herald, when Bank of Miami closed their doors for good.

In October First Bank of Jacksonville was taken over by the FDIC Friday; Ameris Bank of Georgia assumed their assets. That same month Progress Bank of Tampa also failed and was taken over by the FDIC along with Bay Cities Bank, also based in Tampa, and Wakulla Bank in Crawfordville.

In August, the FDIC took over the assets Independent National Bank of Ocala and Community National Bank in Barlow, which operated a total of 5 branches in Central Florida. The assets of both banks, including customer accounts, were assumed by the CenterState Bank of Florida in Winter Haven.

In July regulators closed the Sterling Bank of Lantana, Metro Bank of Dade County, Turnberry Bank in Aventura and the Olde Cypress Community Bank in Clewiston.

In May Bank of Florida-Southeast, based in Fort Lauderdale, was shut down along with Bank of Florida-Southwest, based in Naples and Bank of Florida-Tampa Bay, based in Tampa. All three were owned by holding company Bank of Florida Corp.

In March, regulators closed the Key West Bank of Key West.

Florida’s bank collapses stemmed from the meltdown in the real estate market which brought an avalanche of soured mortgage loans and the lingering recession.

The FDIC had predicted that 2010 would be the high-water mark for bank failures with 2011’s outlook looking better. But some industry observers, like Miami economist and bank consultant Ken Thomas, aren’t so sure.

“I predict we will still have substantial bank failures next year, most likely in the 125 to 150 range,” Thomas told the paper.

The growing bank failures have sapped billions of dollars out of the deposit insurance fund. It fell into the red last year, and its deficit stood at $20.7 billion as of June 30.

The FDIC expects the cost of resolving failed banks to total around $60 billion from 2010 through 2014.

(© MMX CBS Television Stations. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. CBS4 news partner The Miami Herald contributed material for this report)

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