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NEW YORK: A regional bank in Illinois closed its doors Thursday, bringing the total number of failed banks in the United States to 46 so far in 2009, according to the Federal Deposit Insurance Corporation.Local banks have been dropping like flies as plummeting home values devalued mortgage-backed assets and rising unemployment rates caused an increasing number of consumers to default on their loans. Larger financial institutions have been helped along with government bailouts, but smaller regional banks continue to struggle.0:00
/1:07Citi rapped by JapanState regulators shuttered John Warner Bank, based in Clinton, Ill., and named the FDIC the receiver. The State Bank of Lincoln, based in Lincoln, Ill., will assume all of the deposits of the failed bank.As of April 30, the failed bank had total assets of 70 million and total deposits of approximately 64 million.The three offices of John Warner will reopen on Friday as branches of State Bank of Lincoln. Customers of the shuttered bank will automatically become depositors of State Bank of Lincoln. John Warner was the seventh bank to fail in Illinois so far this year. The total cost of Thursday’s bank failure to the FDIC is 10 million, bringing the FDIC fund’s total cost for failed banks to 11.95 billion this year. That compares with 17.6 billion in all of 2008.The number of bank failures so far this year has already far exceeded last year’s total of 25.The FDIC, which is funded primarily by fees paid by banks, insures individual deposits up to 250,000. The amount was increased from 100,000 late last year in response to concerns about the stability of the nation’s banks.

Source:CNN