3 Banks Shut Down; Insurance Firm Merger Collapses

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The financial industry meltdown has been the worst since the great depression. BNET Financial provides daily industry trends and news coverage with insights for managers and executives about the major financial services companies in the banking and finance sector. In addition to detailed company profiles, we bring you industry analysis on new mergers, partnerships, financial products, rates, investments, capital, and a host of other critical factors of success in the finance business.

Three banks have closed and a major real estate insurance firm is tottering after a takeover deal fell through.

Federal regulators have shut down Downey Savings and Loan in Newport Beach, Calf. and PFF Bank & Trust in Ponoma, Calf. The Community Bank in Loganville, Ga. also has shut down.

The Office of Thrift Supervision shut down Downey S&L with $12.8 billion in assets and also PFF with $3.7 billion in assets. Both had been heavily exposed to the depressed real estate market in Southern California and their demise was anticipated. The federal regulator is selling the banks to U.S. Bank in Minneapolis. Part of Community Bank’s $681 million in assets were sold to Bank of Essex in Virginia.

As of Nov. 21, 22 banks have failed so far this year.

Meanwhile, LandAmerica Financial Group, a Richmond, Va.-based title insurance and real estate services firm, is struggling since its planned merger with Fidelity National Financial, Inc. of Jacksonville, Fla. has collapsed. No reasons were given. When the merger was announced Nov. 7, LandAmerica’s stock was valued at $128.4 million but since has fallen to $113.5 million. The firm has laid off 120 employees.

Tags: Asset, Bank, Merger, Insurance, Financial Services, Mergers & Acquisitions, Asset Management, Investment, Finance, Operational Planning, Business Operations, Peter Galuszka

Peter Galuszka is a Virginia-based journalist with more than three decades of experience, including 15 years at BusinessWeek, during which he was twice Moscow Bureau Chief and International News Editor in New York.