Sept 16 - First National Bank, Edinburg, Texas, has been closed by the Office of the Comptroller of the Currency, which appointed the FDIC as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with PlainsCapital Bank, Dallas, Texas, to assume all of the deposits of First National Bank.
As of June 30, 2013, First National Bank had approximately $3.1 billion in total assets and $2.3 billion in total deposits. In addition to assuming all of the deposits of First National Bank, PlainsCapital Bank agreed to purchase approximately $2.7 billion of First National Bank's assets. The FDIC will retain the remaining assets for later disposition.
The FDIC and PlainsCapital Bank entered into a loss-share transaction on $1.8 billion of First National Bank's assets. PlainsCapital Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: www.fdic.gov/bank/individual/failed/lossshare/index.html.
Interested parties can visit the FDIC's website at www.fdic.gov/bank/individual/failed/firstnatl-tx.html.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $637.5 million. Compared to other alternatives, PlainsCapital Bank's acquisition was the least costly resolution for the FDIC's DIF. First National Bank is the 22nd FDIC-insured institution to fail in the nation this year, and the first in Texas. The last FDIC-insured institution closed in the state was First International Bank, Plano, on Sept. 30, 2011.