Cape Coral bank fails, 11th in U.S. to do so in 2009
A Cape Coral-based bank failed today, making it the 11th bank in the country to fail in 2009, according to the Federal Deposit Insurance Corporation.
The Florida Office of Financial Regulation closed Riverside Bank of the Gulf Coast, which had assets of about $539 million as of Dec. 31, and the FDIC took it over.
“The bank closed because of poor oversight of its commercial real estate and residential lending activities coupled with the economic conditions that had a significant impact on the bank’s performance,” said FDIC spokesman David Barr.
Its nine offices will reopen Tuesday as branches of TIB Bank, which struck a deal with the FDIC to buy about $300 million in deposits for $3.9 million or 1.3 percent. Monday is Presidents Day, a bank holiday. TIB will also assume about $125 million in assets.
“We were after the deposits to strengthen our core franchise and it gives us the additional ability to lend in these markets,” said Tom Longe, chairman and chief executive officer of TIB Financial Corp., the bank’s parent company.
Naples-based TIB, with about $1.52 billion in assets and $1.2 billion in deposits, operates 19 offices, including its Bank of Venice locations. It has about 40,000 customers and the acquisition of Riverside’s deposit base will add another 25,000.
The company did not buy $142.6 million in brokered deposits so customers who placed money with brokers should contact them directly, the FDIC said. TIB has 30 days to determine if it will purchase any loans.
Riverside employed about 135 people and TIB has made no personnel decisions yet, said Mike Carrigan, the bank’s president and chief executive officer.
Business should operate as usual and deposits are still FDIC insured, but for the next week, customers should use their current branches while the conversion is complete, Longe said.
TIB accepted $37 million in federal Troubled Asset Relief Funds, Longe said in a Feb. 6 Naples Daily News guest commentary column.
“That was not meant to ‘fix’ anything; rather it was used to increase our existing capital base, which increases our lending power,” he said.
Riverside had signed an agreement for corrective action with the Federal Reserve Bank of Atlanta and the Florida Office of Financial Regulation’s Division of Financial Institutions, according to a November report.
Regulators will require “significant changes in management and the implementation of a capital plan,” said Randy Graber, the bank’s CEO and chief financial officer in that report.
A phone number for Graber could not be found Friday night.
Riverside was one of four banks to be closed Friday. The last bank to fail in Florida was Ocala National Bank on Jan. 30. Riverside Bank of the Gulf Coast is not affiliated with either Riverside National Bank of Florida, Fort Pierce, or with Riverside Bank of Central Florida, Winter Park.
(From the Naples Daily News; reprinted with permission.)