PFF Bank & Trust of Pomona was one of three FDIC bank closings today. The closure marked the 22nd FDIC casualty of the credit crisis in 2008.
The bank had assets of $3.7B and $2.4B in deposits. PFF had a large concentration of housing construction loans hit hard by the deteriorating real estate market on the West Coast.
Federal regulators shut down two big savings and loans based in Southern California on Friday, saying they fell victim to the acute distress in the housing market in that state.
The two companies were the Downey Savings and Loan Association, based in Newport Beach, and PFF Bank & Trust of Pomona. Their closings brought the number of bank failures this year to 22.
The Office of Thrift Supervision, was the federal regulator for the California thrift.The acquiring institution is US BanK of Ohio. According to the official FDIC wed site:
All deposit accounts and all loans have been transferred to U.S. Bank, National Association, Cincinnati, OH. All former PFF Bank banks will reopen for normal business hours as branches of U.S. Bank.
The FDIC will be taking a $700M hit in the failure of PFFF.
The FDIC estimated that Downey’s failure will cost the deposit insurance fund $1.4 billion, while PFF will cost another $700 million. As of the end of June, the fund had $45.2 billion, although the FDIC has multiple ways to boost the fund if necessary, including emergency lines of credit.
US Bancorp said U.S. Bank will buy almost all of PFFs and Downey’s assets, but it will not acquire assets or liabilities of their parent holding companies.
Nice deal. Bet you wish you could get one too.