ANB Financial Closed - arkansas national bank, anb,
Federal regulators close Arkansas bank ANB Financial
BENTONVILLE, Ark. (AP) - Federal regulators says they've closed ANB Financial National Association banks after discovering "unsafe and unsound" business practices there.
David Barr, a spokesman for the Federal Deposit Insurance Corp. says many customers served by the bank's nine locations had accounts under $100,000, which will be fully insured by the government. Barr says customers can continue to write checks and draw money from ATMs through the weekend.
Barr says Pulaski Bank and Trust Co. agreed to assume control over ANB Financial's bank locations, which will be open Monday.
As of Jan. 31, federal regulators say ANB Financial had about $2.1 billion in assets and $1.8 billion in total deposits.
It was the third closure this year of an FDIC-insured bank. Douglass National Bank, a Missouri bank with $58.5 million in assets, was shut in January; another Missouri institution with assets of $18.7 million, Hume Bank, was shut down in March.
Both were dwarfed in size of ANB Financial, where regulators found lax lending standards, mostly for construction and development loans for projects in Utah, Idaho and Wyoming, as well as Arkansas.
Observers have been watching for signs of bank distress resulting from the mortgage crisis. Profits at federally insured U.S. banks and thrifts plunged to a 16-year low in the fourth quarter as institutions set aside a record-high amount to cover losses from sour mortgages.
The FDIC is planning to beef up its staff, including temporarily hiring up to 25 retired FDIC employees who worked in the agency's more than 200-person division that handles failed banks. They will handle an anticipated increase in bank failures.
Rogers-based ANB Financial filed suit against Steve Butcher and Global Modular Technologies for more than $1 million from an unpaid loan made to the defendants last July.
The legal complaint filed in Benton County Circuit Court on Tuesday indicated the loan was due in full by Oct. 30. Collateral for the $1,005,000 original note included 63 shares of PB2 Companies Ltd., the Rogers-based architecture and engineering firm founded by Perry Butcher, the defendant's father. The filing indicated the shares had a market value in excess of $2 million, when pledged as collateral last July. Steve Butcher was president of PB2 at the time the loan was made but resigned the following month, the filing said.
Global Modular Technologies, a Florida LLC and co-borrower, pledged its tangible receivables against the note, according to the filing.
The bank has asked the court to grant it first priority and allow enforceable liens against the collateral it holds, so the outstanding debt can be settled through a commissioner's sale.
ANB Financial N.A., a Bentonville, Ark.-based bank, has been closed by the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. has been named receiver, the FDIC said late Friday. The failure of ANB Financial marks the third bank failure of the year, following the closure of Hume, Mo.-based Hume Bank in early March. See related story. The FDIC said in a statement that while ANB Financial's failure is the third FDIC-insured institution to be closed so far in 2008, there were a total of three such closures last year. The FDIC said that ANB Financial's nine offices will reopen Monday as branches of Little Rock, Ark.-based Pulaski Bank and Trust Co., which will assume all of ANB Financial's depositors. ANB Financial had $2.1 billion in assets and $1.8 billion in total deposits as of Jan. 31, the FDIC said. End of Story