Friday, the Arizona Department of Financial Institutions closed Towne Bank of Arizona, headquartered in Mesa, Arizona, and the FDIC was appointed receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Commerce Bank of Arizona, headquartered in Tucson, Arizona, to assume all of the deposits of Towne Bank of Arizona.
As of March 31, 2010, Towne Bank of Arizona had approximately $120.2 million in total assets and $113.2 million in total deposits. Commerce Bank of Arizona will pay the FDIC a premium of 0.03% to assume the deposits of Towne Bank of Arizona, and agreed to purchase essentially all of the failed bank's assets. The FDIC and Commerce Bank of Arizona entered into a loss-share transaction on $80.1 million of Towne Bank of Arizona's assets.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $41.8 million. Towne Bank of Arizona is the 67th FDIC-insured institution to fail in the nation this year and the second Arizona.