Bank Failure – Commerce Bank of Southwest Florida Shut Down
Commerce Bank of Southwest Florida (Fort Myers) has failed and the FDIC was appointed receiver.
On Friday, November 20, 2009 Commerce Bank of Southwest Florida, Fort Myers, FL was closed by the Florida Office of Financial Regulation, and the Federal Deposit Insurance Corporation (FDIC) was named Receiver.  No advance notice is given to the public when a financial institution is closed.[...] FDIC statement
This is another case where the public had some advance warnings that the bank ‘may’ have been in trouble.
July 9, 2009 (Cease and Desist Order FDIC-09-113b)
[...]Commerce Bank of Southwest Florida, Fort Myers, Florida, (“Bankâ€), having been advised of its right to a NOTICE OF CHARGES AND OF HEARING detailing the unsafe or unsound banking practices alleged to have been committed by the Bank[...]
[...]The FDIC and OFR considered the matter and determined that they had reason to believe that the Bank had engaged in unsafe or unsound banking practices[...]
[...] IT IS HEREBY ORDERED, that the Bank, its institution-affiliated parties, as that term is defined in section 3(u) of the Act, 12 U.S.C. § 1813(u), and Section 655.005(1)(i), Florida Statutes, and its successors and assigns, cease and desist from the following unsafe or unsound banking practices:
A. Engaging in hazardous lending and lax collection practices.
B. Operating with an inadequate level of capital protection for the kind and quality of assets held.
C. Operating with an excessive level of adversely classified assets, delinquent loans, and nonaccrual loans.
D. Operating with inadequate liquidity in light of the Bank’s asset and liability mix.
E. Operating in such a manner as to generate inadequate earnings.
F. Operating with an inadequate allowance for loan and lease losses for the volume, kind, and quality of loans and leases held.
G. Operating with an excessive concentration of credit in commercial real estate loans.
H. Operating with excessive interest rate risk.
I. Operating with management whose policies and practices are detrimental to the Bank and jeopardize the safety of its deposits. (emphasis added)
This Cease and Desist order is public information available from the FDIC’s own web site if you know where to look. See 2009 FDIC actions in my November 4, 2009 post.
The entire Cease and Desist order from July 9, 2009 –
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