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2008-08-28  ALPHARETTA AND ROSWELL REVUE & NEWS | State closes Integrity Bank of Alpharetta
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| | by Bob Pepalis | |  |
September 03, 2008
www.northfulton.com
ALPHARETTA -- Integrity Bank's closure Aug. 29 after failing due to bad construction loans coupled with falling real estate value has not jeopardized depositor's money.
Regions Bank bought the more than $900 million in deposits of 23,000 customers of the Alpharetta-based bank, including deposits above the insurance limits set by the Federal Deposit Insurance Corp.
Regions reopened Integrity's five bank branches – in Alpharetta, Roswell, Cumming, Duluth and Vinings – Tuesday morning under its own banners.
Regions has agreed to pay a total premium of 1.012 percent for the failed bank's deposits. In addition, Regions Bank will purchase approximately $34.4 million of Integrity Bank's assets, consisting of cash and cash equivalents. The FDIC will retain the remaining assets for later disposition.
Bill Linginfelter, Regions' area executive for North Georgia/Atlanta, said the Birmingham, Ala.-based bank plans to purchase the Integrity branches and operate at least four of them. As the Roswell branch is across the street from Regions' own branch, only one of those locations is likely to remain open.
Regions acquired the Integrity deposits for the market coverage the bank had. Linginfelter said the branches were in fabulous markets. The purchase also helps Regions broaden its retail and commercial sides.
"Businesses still like to have branches to go into, especially if they have payroll transactiosn to deal with," he said.
Linginfelter said while the business world doesn't operate purely on altruistic reasons, it's nice to step in when the "FDIC asks you to consider helping them with a situation that isn't going to be pretty."
Had Regions not taken all the desposits, even those above FDIC insured limits, some depositors would have lost money if the bank went into full receivership, he said. Now Regions has to build on the relationship Integrity had with its customers.
"If you are meeting their needs, they will buy from you. That's what I've seen today in these branches – and I've been in four," Linginfelter said.
Integrity Bank was closed by the Ga. Department of Banking and Finance under state Code, which authorizes the department in its discretion to take possession of the business and property of any state chartered financial institution whenever such financial institution is either insolvent or operating in an unsafe or unsound condition, is in violation of any court order, statute, rule or regulation, or asks the department to take possession of its business and property.
Integrity was the tenth bank to fail in the United States this year, according to the FDIC. The last bank failure in Georgia was NetBank, also based in Alpharetta, on Sept. 28, 2007. The FDIC's LaJuan Williams-Dickerson said there were 8,451 banks in the United States as of the end of the second quarter,
She said the sale to Regions was approved because it was best for the depositors and was least costly. The FDIC estimates that the cost to its Deposit Insurance Fund will be between $250 million and $350 million.
The FDIC insures deposits up to $100,000 and retirement accounts up to $250,000.
"Basically the reason why banks are having such a hard time [is that] real estate values are decreasing. It's just really a fickle time. Banks are feeling it," she said.
"We had hundreds of bank closures in the '80s and '90s. We have 8,451 banks. So 10 banks is still a relatively small number," she said. "Overall banks are still safe. Depositors have never lost one penny of insured deposits."
She said the FDIC works closely with banks to make sure they deal with issues that arise from FDIC examiners.
Gov. Sonny Perdue tried to ease depositors' concerns.
"I want to reassure Georgians that our state's banking industry remains on solid footing, and two-thirds of banks in our state have been profitable year to date," said Perdue. "While there is concern about many of our industries given the national economic climate, Georgians should not overreact to the news of one bank closing."
Banking services
As of Sept. 2, customers may continue to use the services to which they previously had access, such as, safe deposit boxes, night deposit boxes, wire services, etc.
• ATM and online services will remain available.
• All outstanding checks will be paid against available insured balances as if no change had occurred. If a merchant refuses to accept a check, call 1-800-523-1958.
• Regions Bank will be reviewing interest rates and will provide further information soon. Automatic direct deposits and/or automatic withdrawals will be transferred automatically.
• Customers with an Integrity Bank loan should continue to make payments as usual and sent to the same address. For further questions, call 1-800-523-0640.
Finding answers
Customers with questions about the transaction or who would like more information about the failure of Integrity Bank can:
• Visit the FDIC's Web site at www.fdic.gov/bank/individual/failed/integrity.html;
• Or call the FDIC toll-free at 1-800-523-0640 from 8 a.m. to 8 p.m.
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Finding answers
Customers with questions about the transaction or who would like more information about the failure of Integrity Bank can:
• Visit the FDIC's Web site at www.fdic.gov/bank/individual/failed/integrity.html;
• Or call the FDIC toll-free at 1-800-523-0640 from 8 a.m. to 8 p.m. |
Banking services
As of Sept. 2, customers may continue to use the services to which they previously had access, such as, safe deposit boxes, night deposit boxes, wire services, etc.
• ATM and online services will remain available.
• All outstanding checks will be paid against available insured balances as if no change had occurred. If a merchant refuses to accept a check, call 1-800-523-1958.
• Regions Bank will be reviewing interest rates and will provide further information soon. Automatic direct deposits and/or automatic withdrawals will be transferred automatically.
• Customers with an Integrity Bank loan should continue to make payments as usual and sent to the same address. For further questions, call 1-800-523-0640. | |
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