On Friday, the OTS closed Charter Bank, headquartered in Santa Fe, New Mexico, and the FDIC was named receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Charter Bank, a newly chartered federal savings bank headquartered in Albuquerque, New Mexico, and a subsidiary of Beal Financial Corporation, headquartered in Plano, Texas, to assume all of the deposits of the failed bank. The acquiring bank did not pay a premium for the deposits of the failed bank.

As of December 31, 2009, the failed bank had approximately $1.2 billion in total assets and $851.5 million in total deposits. The acquiring bank also agreed to purchase essentially all of the failed bank’s assets. The FDIC and the acquiring bank entered into a loss-share transaction on $805.5 million of the failed bank’s assets.

The FDIC estimates that the cost to the Deposit Insurance Fund will be $201.9 million. Charter Bank is the seventh FDIC-insured institution to fail in the nation this year and the first to fail in New Mexico since Zia New Mexico Bank in April 1999.