April 8 (Bloomberg) -- City National Corp., the Los Angeles-based commercial lender, purchased a failed Nevada bank, and another financial institution was seized, as this year’s tally of shut-down firms reached 28.
City National bought Las Vegas-based Nevada Commerce Bank and the Office of the Comptroller of the Currency closed a bank in Illinois, the Federal Deposit Insurance Corp. said in statements on its website. The two transactions drained $62.9 million from the FDIC’s deposit-insurance fund.
“This cost-effective acquisition of Nevada Commerce Bank underscores City National’s commitment to Nevada, and it enhances our ability to serve a greater number of entrepreneurs, professionals and small and mid-size businesses in Las Vegas,” City National Chief Executive Officer Russell Goldsmith said in a statement.
Banks are closing under stress from commercial real estate loans, tied to property values that fell as much as 45 percent from the October 2007 peak through last August, according to Moody’s Investors Service. Since 2008, nearly 350 lenders have been shut down by regulators.
City National is expanding in Nevada, the state with the highest unemployment rate in the country at 13.6 percent. It paid a 0.71 percent premium for Nevada Commerce’s more than $136 million in deposits, the FDIC said. In May, City National purchased Las Vegas-based Sun West Bank, paying a 0.67 percent premium for more than $350 million in deposits.
The OCC closed the two branches of Western Springs National Bank & Trust, based in Western Springs, Illinois. Heartland Bank and Trust Co. of Bloomington purchased the failed lender, adding more than $180 million in assets and deposits, according to the FDIC.
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