ShoreBank of Chicago Shuttered by Regulators, Reop

ShoreBank of Chicago Shuttered by Regulators, Reop
ShoreBank Corp., the Chicago lender operating under a Federal Deposit Insurance Corp. cease-and- desist order for 13 months,moncler, was shut by regulators and most of its assets were sold to Urban Partnership Bank.
Urban Partnership,moncler, created to make the acquisition, will keep ShoreBank’s 15 branches, including those in Cleveland and Detroit,timberland boots sale, according to the FDIC. The newly chartered lender paid a 0.50 percent premium for the deposits and will share $1.41 billion in losses with the FDIC, the agency said. The closure will cost the FDIC’s deposit-insurance fund $367.7 million.
Investors in Urban Partnership include Goldman Sachs Group Inc., General Electric Co.,mbt, JPMorgan Chase & Co., Citigroup Inc. and philanthropic groups, said two people familiar with the matter, who declined to be identified because talks were private. ShoreBank raised more than $145 million from the firms in May and the funds were placed in escrow pending a decision by the U.S. Treasury to offer another $75 million in bailout funds.
The bank kept losing money and the government elected not to provide more capital, people with knowledge of the rescue efforts said. The private capital will now be used for Urban Partnership, giving it Tier 1 capital of at least 8 percent,moncler down jackets, the people said. Its chief executive officer will be William Farrow, a former executive at the Chicago Board of Trade and Bank One Corp., they said.
ShoreBank’s Tier 1 capital shrank to $4.1 million at the end of June from $26.3 million on March 31 and $43.5 million at the end of last year,mbt shoes clearance, according to the FDIC. The bank had “engaged in unsafe or unsound banking practices,” the FDIC said in its order last July. ShoreBank had $2.16 billion of assets on June 30.
FDIC Order
ShoreBank,moncler jackets, based on Chicago’s South Side, was founded in 1973. In March, ShoreBank was ordered by the FDIC to boost capital within 60 days, a deadline it missed.
ShoreBank posted a $119 million loss in 2009 and a $39.6 million loss in the first half of this year, according to FDIC figures. It had a net loss of $9.3 million in 2008.
Representative Spencer Bachus, the ranking Republican on the House Financial Services Committee, said in May that firms that had banded together in an attempt to save ShoreBank were making the investments to gain favor with President Barack Obama’s administration.


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