On Friday, the FDIC was named as receiver for two failed subsidiaries of Irwin Financial Corporation, headquartered in Columbus, Indiana. The Indiana Department of Financial Institutions closed Irwin Union B&T, headquartered in Columbus, Indiana, and the OTS closed Union Bank, F.S.B., headquartered in Louisville, Kentucky. The FDIC entered into a purchase and assumption agreement with First Financial Bank, N.A., headquartered in Hamilton, Ohio, to assume to the deposits of both institutions. First Financial Bank will pay a 1% premium to assume the deposits of Irwin Union B&T and will pay no premium for the deposits of Irwin Union Bank, F.S.B.
As of August 31, 2009, Irwin Union B&T had total assets of $2.7 billion and total deposits of approximately $2.1 billion. Irwin Union Bank, F.S.B. had total assets of $493 million and total deposits of approximately $441 million. The FDIC and First Financial Bank entered into a loss-share transaction on approximately $2.5 billion of the assets of the failed institutions.
The FDIC estimates that the cost to the Deposit Insurance Fund will be $850 million. Today’s failures bring the total number of bank failures in the nation this year to 94 and the first in Indiana and Kentucky.