The Federal Deposit Insurance Corporation reports that Valley Bank, Moline, Illinois, was closed Friday by the Illinois Department of Financial & Professional Regulation – Division of Banking, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. Valley Bank operated local branches in Knoxville and Oskaloosa.
To protect the depositors, the FDIC entered into a purchase and assumption agreement with Great Southern Bank, Reeds Spring, Missouri, to assume all of the deposits of Valley Bank.
The FDIC reports that the 13 branches of Valley Bank will reopen as branches of Great Southern Bank during their normal business hours. Depositors of Valley Bank will automatically become depositors of Great Southern Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Valley Bank should continue to use their current branch until they receive notice from Great Southern Bank that systems conversions have been completed to allow full-service banking at all branches of Great Southern Bank.
Depositors of Valley Bank can continue to access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of March 31, 2014, Valley Bank had approximately $456.4 million in total assets and $360.0 million in total deposits. In addition to assuming all of the deposits of Valley Bank, Great Southern Bank agreed to purchase approximately $375.4 million of the failed bank’s assets. The FDIC will retain the remaining assets for later disposition.
Customers with questions about the transaction should call the FDIC toll-free at 1-800-894-2013. The phone number will be operational on Sunday from noon to 6:00 p.m., CDT; on Monday from 8:00 a.m. to 8:00 p.m., CDT; and thereafter from 9:00 a.m. to 5:00 p.m., CDT. Interested parties also can visit the FDIC’s Web site at http://www.fdic.gov/bank/individual/failed/valleybankil.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $51.4 million. Compared to other alternatives, Great Southern Bank’s acquisition was the least costly resolution for the FDIC’s DIF. Valley Bank is the 10th FDIC-insured institution to fail in the nation this year, and the third in Illinois. The last FDIC-insured institution closed in the state was AztecAmerica Bank, Berwyn, on May 16, 2014.