Bank of America announced a layoff of 3,500 workers. If the U.S. banking system can shrink to a sustainable size, it will happen as a result of a long series of moves like this. The new layoffs are not related to the branch closings that insiders say are coming by next year.
Bank stocks plummeted this week as investors worried about the effects of a possible global recession.
Banks failed tonight in Florida, Georgia, and Illinois. There was also a bank failure last night in Pennsylvania. The largest failure was Lydian Private Bank, which had $1.24 billion in deposits and an additional $1 billion in assets under management, and 5 locations in southeastern Florida. It was the largest bank in Palm Beach County in assets, if not in physical footprint. Its online banking approach proved to be more expensive than it planned on, and its option ARM loans and a series of accounting problems hastened its decline.
The FDIC is fortunate to have a buyer for the bank. Miami-based Sabadell United Bank is taking over the deposits and purchasing the assets.
First Southern National Bank failed tonight in Statesboro, Georgia. It had one location and $160 million in deposits. Heritage Bank of the South is assuming the deposits and purchasing the assets.
First Choice Bank failed tonight in Geneva, Illinois, with $137 million in deposits. Inland Bank & Trust is taking over the deposits and purchasing the assets.
Last night in the Pennsylvania suburbs of Philadelphia, Public Savings Bank failed in an unusual Thursday night bank failure. It had one location and $45 million in deposits. Maryland-based Capital Bank took over the deposits and purchased the assets.