Henderson-based Security Savings Bank was shut down by banking regulators Friday and will reopen on Monday as branches of the Bank of Nevada.
Andrew Gray, spokesman for the Federal Deposit Insurance Corp., said Las Vegas-based Bank of Nevada will acquire all of the failed bank’s deposits, totaling $175.2 million on Dec. 31.
"The insured and the uninsured have been acquired so no one has lost any money that is deposited at the bank even if you’re over the deposit insurance limits," Gray said. The FDIC last year increased its coverage of insurance to $250,000 for most deposits.
The bank’s customers will be able to access their accounts this weekend by writing checks or using ATM or debit cards, a statement from the FDIC read.
Checks drawn on the bank will continue to be processed. Security Savings’ loan customers should continue to make payments as usual, the federal agency said.
"It will be a smooth transition and business as usual for customers," Gray said.
Nevada Financial Institutions Division closed the bank’s two offices, and appointed the FDIC as receiver.
The FDIC, in turn, sold the deposits to Bank of Nevada. Bank of Nevada agreed to purchase $111.3 million of Security Savings Bank’s assets.
The FDIC will retain the remaining assets, totaling $238.3 million Dec. 31, for later sale or liquidation.
The FDIC estimates the cost to the deposit insurance fund will be $59.1 million.
Securities Savings Bank saw its loan portfolio, which had a high volume of acquisition, development and construction loans, deteriorate with the downturn in the economy.
The bank’s losses swelled from $1.9 million at the end of 2007 to $28.5 million last year, according to the FDIC.
"The losses eroded their capital and they just weren’t able to stay in business," Gray said.
Jesse Torres is listed as president of the bank and Mark DeBacker is listed as secretary-treasurer on the Nevada secretary of state’s Web site.
Security Savings’ closure is the 16th bank failure of 2009 and the first bank closure in Nevada since Washington Mutual Bank was shut down on Sept. 25.
Twenty-five U.S. banks failed last year — including two of the biggest thrifts — more than in the previous five years combined and up from only three failures in 2007.
It is the third Nevada-based to fail since last year. First National Bank of Nevada was seized in July and Silver State Bank was shut down in September.
As a result, the deposit insurance fund dropped to $18.9 billion at Dec. 31 — the lowest level since 1987 — from $52.4 billion at the end of 2007.
The agency now expects bank failures will cost its insurance fund around $65 billion through 2013, up from an earlier estimate of $40 billion.
Contact reporter Arnold M. Knightly at firstname.lastname@example.org or 702-477-3893.
The Associated Press contributed to this report.