Bank Failures

Federal regulators now believe that U.S. bank failures will cost the deposit insurance fund more than $40 billion over the next four years as the economy weakens, a government official said. John Bovenzi, Federal Deposit Insurance Corp. chief operating officer, said the agency's estimate last fall of $40 billion in losses through 2013 probably would be surpassed.

The California Department of Financial Institutions closed Redlands-based 1st Centennial Bank late Friday, saying its six branches will reopen Monday as part of First California Bank of Camarillo. Like many Inland Empire banks, 1st Centennial ran into trouble funding home builders. It was the third U.S. bank to fail this year and the first in California since Downey Savings of Newport Beach on Nov. 21. The Federal Deposit Insurance Corp.

Say goodbye to IndyMac. The name, at least. The investors buying failed IndyMac Federal Bank from regulators intend to rename the Pasadena savings and loan, although they haven't yet picked a new name, a spokesman said Monday. The old name is "obviously" a liability, said George Sard, a spokesman for the investment group, IMB Management Holdings. IndyMac was one of the largest bank failures in U.S. history, brought down last summer by soured variable-rate mortgages and a run on deposits.

A long-awaited sale of IndyMac Bank may be announced as early as today. The Federal Deposit Insurance Corp. has been looking for a buyer, or buyers, for the Pasadena lender since the government declared it insolvent and seized it in July. Final bids were due by Dec. 12, and the FDIC said it expected to close a deal by the end of the year. The American Banker newspaper reported Tuesday that the announcement could come today.

Regulators have shut down First Georgia Community Bank, the 23rd U.S. bank to fail this year. The Federal Deposit Insurance Corp. has been appointed receiver of the bank, located in Jackson. It had $237.5 million in assets and $197.4 million in deposits as of Nov. 7. Customers will still have full access to their deposits, the FDIC said.

Federal regulators seized Downey Savings & Loan and PFF Bank & Trust late Friday, saying hundreds of millions of dollars in bad loans from the housing bubble had rendered the Southern California banking fixtures unsound. The banks' branches will continue operating as usual under the ownership of Minneapolis-based U.S. Bank, one of the country's largest banks, and no depositors will lose any money because of the failures, regulators said. Newport Beach-based Downey lost $547.

Months before the global financial meltdown this fall, the talk in the boisterous cafes of Rome and Madrid had turned from sports and politics to economic woes. Despite increasingly bleak outlooks, however, the international financial panic did not hit Italy and Spain as hard as other European nations. Unlike France, Britain or Germany, there have been no major bank failures or rushed bank rescues south of the Alps or the Pyrenees. Why? The reasons range from the prudence and discipline of institutions and individuals to the existence of large informal economies, analysts say. Not to mention remaining a bit old-fashioned amid modernization.

Crippled by loans to Inland Empire developers and home builders, Security Pacific Bank of West Los Angeles was shut down Friday by regulators, who said L.A.-based Pacific Western Bank would take over its four branches. Depositors of the failed bank will have their $450 million in accounts transferred to 60-branch Pacific Western, which also is buying some of Security Pacific's loans, the California Department of Financial Institutions and the Federal Deposit Insurance Corp. said.