By Mike W. Ray
Southwest Ledger
The First National Bank of Lindsay was closed Oct. 18, the Federal Deposit Insurance Corp. was named receiver, and the bank’s insured deposits were transferred to First Bank & Trust Co. in Duncan.
The Office of the Comptroller of the Currency closed the bank after uncovering “false and deceptive bank records suggesting fraud,” which the OCC stated led to depletion of the bank’s capital. The OCC found that the bank was in an unsafe or unsound condition to conduct business, and the bank’s assets were less than its obligations to its creditors and others.
The Comptroller’s office referred the matter to the U.S. Department of Justice for investigation.
The full balance of all insured deposit accounts in the Lindsay bank was transferred to First Bank & Trust Co., the FDIC reported. The First National Bank of Lindsay’s locations reopened Oct. 21 as branches of First Bank & Trust Co. during regular business hours.
The FDIC reported First Bank & Trust agreed to assume the Lindsay bank’s insured deposits at a premium of 6.67% and will purchase approximately $20 million of the failed bank’s assets. The FDIC will retain the remaining assets for future disposition.
Principal and interest on the Lindsay bank’s insured accounts through Oct. 18 are fully insured by the FDIC up to a limit of $250,000. Accounts exceeding $250,000, and/or accounts that appear to be related and exceed that limit, will be reviewed by the FDIC to determine ownership and insurance coverage. IRA funds are insured separately from other types of accounts, up to a limit of $250,000.
Based on estimated recoveries of the failed bank’s assets, the FDIC made 50% of uninsured funds available to those depositors on Monday. That amount could increase as the FDIC sells the assets of the failed bank, federal regulators said. However, those depositors eventually may take a financial “haircut.”
Customers who think they may have uninsured deposits can contact the FDIC Call Center at (866) 314-1744, from 9 a.m. to 5 p.m. Central to schedule an interview with a claims agent.
According to an FDIC press release, “As of June 30, 2024, The First National Bank of Lindsay reported total assets of $107.8 million and total deposits of $97.5 million. Approximately $7.1 million of the deposits exceeded FDIC insurance limits; this amount is likely to change once the FDIC obtains additional information from customers.”
Customers of the Lindsay bank were informed they could continue to use their checks and ATM/debit cards to access their insured deposits. Direct deposits such as paychecks and Social Security benefits “will continue as usual,” the FDIC said.
Checks drawn on The First National Bank of Lindsay that did not clear before the institution closed last Friday will be honored so long as there are sufficient funds in the account, the FDIC reported.
Customers will be allowed to withdraw their funds from any transferred account without an early withdrawal penalty until they enter into a new deposit agreement with First Bank & Trust Co., so long as the deposits are not pledged as collateral for loans.
The cost of the bank failure to the FDIC’s Deposit Insurance Fund was estimated at $43 million. The FDIC said the last bank failure in Oklahoma occurred at the Freedom, Oklahoma, State Bank on June 27, 2014.