Sun West Bank, Las Vegas, Nevada, was closed today by the Nevada Financial Institutions Division, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with City National Bank, Los Angeles, California, to assume all of the deposits of Sun West Bank.
Due to the Memorial Day holiday, the seven branches of Sun West Bank will reopen on Tuesday as branches of City National Bank. Depositors of Sun West Bank will automatically become depositors of City National Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers of Sun West Bank should continue to use their existing branch until they receive notice from City National Bank that it has completed systems changes to allow other City National Bank branches to process their accounts as well.
This evening and over the weekend, depositors of Sun West Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of March 31, 2010, Sun West Bank had approximately $360.7 million in total assets and $353.9 million in total deposits. City National Bank will pay the FDIC a premium of 0.67 percent to assume all of the deposits of Sun West Bank. In addition to assuming all of the deposits of the failed bank, City National Bank agreed to purchase essentially all of the assets.
The FDIC and City National Bank entered into a loss-share transaction on $280.0 million of Sun West Bank's assets. City National 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: http://www.fdic.gov/bank/individual/failed/lossshare/index.html.
Customers who have questions about today's transaction can call the FDIC toll-free at 1-800-523-8089. The phone number will be operational this evening until 9:00 p.m., Pacific Daylight Time (PDT); on Saturday from 9:00 a.m. to 6:00 p.m., PDT; on Sunday from noon to 6:00 p.m., PDT; and thereafter from 8:00 a.m. to 8:00 p.m., PDT. Due to the Memorial Day holiday on Monday, the phone number only will be operational from 8 a.m. to 12 noon PDT on that day. Interested parties also can visit the FDIC's Web site at http://www.fdic.gov/bank/individual/failed/swbnevada.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $96.7 million. City National Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to all alternatives. Sun West Bank is the 78th FDIC-insured institution to fail in the nation this year, and the second in Nevada. The last FDIC-insured institution closed in the state was Carson River Community Bank, Carson City, on February 26, 2010.
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Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 7,932 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars – insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically (go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information Center (877-275-3342 or 703-562-2200). PR-127-2010