Imperial Capital branches to reopen Monday as City National Bank
The nine branches of Imperial Capital Bank will reopen Monday as branches of City National Bank after the California Department of Financial Institutions closed the La Jolla-based bank because of inadequate capital and other weaknesses.
The Federal Deposit Insurance Corp. was appointed as receiver and entered into a purchase and assumption agreement with City National Bank to assume all of Imperial Capital Bank’s assets, Greg Hernandez of the Federal Deposit Insurance Corp. said.
Depositors can access their money over the weekend by writing checks or using automated teller machine or debit cards, Hernandez said.
Checks drawn on the bank will continue to be processed. Loan customers
should continue to make their payments as usual, Hernandez said.
Depositors will automatically become depositors of City National Bank
and continue to be insured by the FDIC, Hernandez said.
Customers should continue to use their existing branch until they
receive notice from City National Bank that it has completed systems changes to allow other City National Bank branches to process their accounts as well, Hernandez said.
Imperial Capital Bank had approximately $4 billion in total assets and
total deposits of $2.8 billion as of Sept. 30, Hernandez said.
Department of Financial Institutions officials had closely monitored
Imperial Capital Bank and ordered it to increase its capital reserves to a “safe and sound level,” but its efforts were unsuccessful, prompting Friday’s closure, the department’s Alana Golden said.
City National Bank paid the FDIC a .24 percent premium to assume all the deposits of Imperial Capital Bank. In addition to assuming all of Imperial Capital Bank’s deposits, City National Bank agreed to purchase $3.3 billion of its assets, Hernandez said.
The FDIC and City National Bank entered in a loss-share transaction on
$2.5 billion of Imperial Capital Bank’s assets. City National Bank will share in the losses on the asset pools covered under the loss-share agreement.
Hernandez estimated that Imperial Capital Bank’s failure will cost the
FDIC’s Deposit Insurance Fund $619.2 million.
City National Bank’s acquisition of all of Imperial Capital Bank’s
deposits was the “least costly” resolution for the fund compared to the alternatives, Hernandez said.
Imperial Capital Bank was the 139th FDIC-insured institution to fail in the nation this year, and the 16th in California, Hernandez said.
Those totals grew by one later Friday when Santa Monica-based First Federal Bank of California was closed.
Customers with questions about the closure can call the FDIC at (800)
613-0523 from noon to 6 p.m. today and 8 a.m. to 8 p.m. weekdays. The toll-free number will not be in operation from 3 p.m. Thursday through 8 a.m. Dec. 28 because of Christmas.
Information is also available online at