TheTennessee Department of Financial Institutions closed Memphis-based Trust Company Bank on Friday, and appointed the Federal Deposit Insurance Corporation as receiver.
Trust Company Bank becomes the second FDIC-insured bank to close in 2016, and the first FDIC-insured bank to close in the state of Tennessee since Community South Bank closed on Aug. 23, 2013.
According to a release from the FDIC, in order to protect the bank’s depositors, the FDIC entered into a purchase and assumption agreement with The Bank of Fayette County, which will assume all of the deposits of Trust Company Bank.
The FDIC stated that as of Dec. 31, 2015, Trust Company Bank had approximately $20.7 million in total assets and $20.3 million in total deposits.
In addition to assuming all of the deposits of Trust Company Bank, The Bank of Fayette County agreed to purchase approximately $3.9 million of the failed bank's assets, the FDIC said.
The FDIC also said that it will retain the remaining assets for later disposition.
According to the FDIC, the estimated cost to the Deposit Insurance Fund will be $7.2 million.
“Compared to other alternatives, The Bank of Fayette County's acquisition was the least costly resolution for the FDIC's DIF,” the FDIC said.
Trust Company Bank’s website now directs visitors to The Bank of Fayette County’s website, and shares details about the bank being closed.
A cached version of Trust Company Bank’s website stated that the bank offered checking, savings, money market deposit accounts, certificates of deposits, IRA, real estate loans, consumer loans, commercial loans, home equity loans and safe deposit boxes.
According to the FDIC, the four branches of Trust Company Bank will reopen as branches of The Bank of Fayette County during normal business hours.
The FDIC also stated that depositors of Trust Company Bank will automatically become depositors of The Bank of Fayette County.
In March, North Milwaukee State Bank became the first bank failure of 2016, and its assets were subsequently acquired by First-Citizens Bank & Trust Company.