FDIC Takes Over Nevada Bank

By: Brendan Riley AP
By: Brendan Riley AP

CARSON CITY, Nev. (AP) - Twenty-eight branches of 1st National Bank of Nevada and First Heritage Bank, operating in Nevada, Arizona and California, were closed Friday by federal regulators.

The banks, owned by Scottsdale, Ariz.-based First National Bank Holding Co., were scheduled to reopen on Monday as Mutual of Omaha
Bank branches, the Federal Deposit Insurance Corp. said.

The FDIC said the takeover of the failed banks was the "least costly" resolution and all depositors - including those with funds in excess of FDIC insurance limits - will switch to Mutual of Omaha with "the full amount of their deposits."

The FDIC also said that over the weekend 1st National account-holders can access their funds by writing checks or using ATM or debit cards.

As of June 30, the closed banks had total assets of $3.6 billion. That's down from $4.1 billion six months earlier. Most of the current assets are in 1st National while First Heritage accounts for $254 million of the total.

Gov. Jim Gibbons said the bank takeover will be closely monitored in Nevada "to ensure there's minimal disruption to business and that employees' jobs are protected as much as possible."

In Nevada, 1st National has 10 branches and employs about 350 people. Five of its branches are in Las Vegas, three are in the Reno-Sparks area, one is in Carson City and one is in Laughlin. Notices of the closure were being posted late Friday at the branches.

The remaining 1st National branches are in Arizona, while Newport Beach-based First Heritage has three branches in Southern California.

George Burns, head of the Nevada Financial Institutions Division, said the 1st National is nationally chartered and isn't regulated by his agency but added, "the demise of any bank operating in Nevada is of concern to our state's financial industry."

Calls to 1st National were referred by a receptionist to Joe Martony, an executive vice-president in Scottsdale, Ariz. Martony didn't return repeated calls to his office.

Bill Uffelman of the Nevada Bankers Association said Friday the FDIC action "is a reflection of the times for the banks. It's a poor economy." He described 1st National Bank of Nevada as being in the top half of banks in the state.

Uffelman cautioned against the sort of consumer concern that prompted many customers of IndyMac Bank branches to wait for hours
in line to withdraw funds across Southern California last week after that bank was seized by federal regulators. He noted that all FDIC-insured bank deposits are guaranteed by the FDIC up to $100,000.

The closure is one of seven FDIC-insured bank closures around the country this year. For Nevada, it's the first closure since Frontier Savings Association in Las Vegas closed in late 1990.
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On the Internet:
http://www.fdic.gov/news/news/press/2008/pr08063.html
http://www.fnbaonlinehb.com/

(Copyright 2008 by The Associated Press. All Rights Reserved.)


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