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Florida accounts for 20% of bank failures this year
Knoxville News.Net
Friday 30th July, 2010
Coastal Community Bank, of Panama City Beach, Florida, which incorporates Apalachicola State Bank whose origins date back more than a century, was closed on Friday by the Florida Office of Financial Regulation.
Starting off as a branch of Tallahassee's Capital City Bank from 1897 - Apalachicola State Bank was incorporated on July 10, 1906, with a capital stock of $25,000.
George Washington Saxon of Tallahassee got interested in Apalachicola at the end of the nineteenth century. In the Capital, he started in the 1880's a store including a private bank under the name of G.W. Saxon & Company. His firm became an outstanding facility which was incorporated under the name of Capital City Bank in 1985. A branch of this bank was established in Apalachicola by Saxon in 1897. T.F. Porter, a New Yorker, was the manager, while another Tallahasseean, Sam E. Teague, came to Apalachicola to serve as cashier.
Saxon was the first president of the new Apalachicola State Bank in its organizing stages. R.F. Porter served as president from 1906 to 1911; followed by Same E. Teague 1911 to 1937; H.L. Oliver 1937 to 1942; G.M. Batterfield 1942 to 1945; G. Rodman Porter 1945 to 1973; R.C. Watkins 1973 to 1983; then Ed Mingledorff for several years; Barry Brynjolfsson came on board and then was followed by Terry DuBose after Coastal Community Bank acquired Apalachicola State Bank in the year 2002.
In 1933, the United States had a serious banking crisis. Many bankers were failing because they had too little capital, too many errors in judgment and poor management, in addition to the world-wide depression. On March 6, President Franklin Delano Roosevelt ordered a bank holiday. All banks closed, and only those which were in a sound financial condition were allowed to reopen.
The Apalachicola State Bank remained open; however, no business was transacted in compliance with the federal edict.
In the debacle, banks with hundreds of millions in deposits were found insolvent while the Apalachicola State Bank, with less than one million, was revealed to be in sound financial condition. It was said Roosevelt's "Bank Holiday" separated the men from the boys in the banking profession.
The Federal Deposit Insurance Corporation (FDIC) was organized in 1933, and the local bank qualified as a member. During the depression year of 1930, the Apalachicola State Bank absorbed the assets and liabilities of the American Exchange Bank of Apalachicola.
Following World War II, the Korean conflict, and the decade-old Vietnam conflict, along with the late 1960's and early 1970's spiraling cost of living and inflation, the Apalachicola State Bank was still sailing through and managing to grow and prosper.
With a modest beginning of $30,000 in 1897, on the bank's seventy-fifth anniversary in 1972, the then-current statement reflected an impressive five million dollars in assets.
On its 100th birthday on March 31, 1997 the bank had total assets of $40,916,460.
In 2002, Coastal Community Bank was formed by a group of men from Apalachicola to Panama City Beach, Florida and they acquired Apalachicola State Bank on March 29 that year. Apalachicola State Bank continued to trade under its own banner as a division of Coastal Community Bank, with the combined group servicing Franklin, Gulf and Bay Counties.
Unfortunately, after surviving two Great wars, the Depression, and a host of other crises, the 113-year old bank, the third oldest in Florida, and its parent Coastal Community Bank, was forced to close on Friday, a victim of the Global Financial Crisis. The Federal Deposit Insurance Corporation (FDIC) was engaged as receiver. To protect depositors, the FDIC entered into a purchase and assumption agreement with Centennial Bank, Conway, Arkansas, to assume all the deposits and essentially all the assets of Coastal Community and Apalachicola State banks.
The failed institutions' eleven branches at Panama City, Apalachicola, St. George Island, Panama City Beach, Southport, Eastpolint, Carrabelle, and Port St. Joe in Florida, as well as Mobile, Alabama, will reopen as branches of Centennial Bank during normal business hours.
Depositors of Coastal and Apalachicola will automatically become depositors of Centennial 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, an FDIC statement published late on Friday evening said.
Customers of the closed banks should continue to use their former branches. Over the weekend, depositors can access their money by writing checks or using ATM or debit cards.
As of March 31, 2010, the Coastal Community Bank group had total assets of $372.9 million and total deposits of $363.2 million.
The FDIC and Centennial Bank entered into loss-share transactions on $302.8 million of Coastal Community Bank's assets.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $94.5 million for Coastal and Apalachicola. Compared to other alternatives, Centennial Bank's acquisition was the least costly resolution for the FDIC's DIF, the regulator said.
106 banks have failed in the United States this year, 20% of which have been in Florida.  Email this story to a friend
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