N.C. bank takes over Carolina Federal

By Lauren Ratcliffe
Published June 11, 2012

Carolina Federal Savings Bank failed Friday and was closed by the Office of the Comptroller of the Currency.

The Federal Deposit Insurance Corp. was appointed receiver of the bank and entered into a purchase and assumption agreement with Bank of North Carolina.

Bank of North Carolina assumed all deposits of the failed bank and is purchasing approximately $41 million in assets. The FDIC will dispose of the remaining assets.

Bank of North Carolina entered the Upstate South Carolina market this year when acquiring Regent Bank of Greenville. Last week, the bank said it raised $72 million from investors to continue its expansion. The bank also acquired a Charlotte bank last week, First Trust Bank, for $35 million.

In the last two years, the $3.2 billion BNC Bank also has acquired Beach First National Bank in Myrtle Beach, Blue Ridge Savings Bank in Asheville, N.C., KeySource Commercial Bank in Durham, N.C., and, the Cary and Chapel Hill branches of HamptonRoads Bankshares Inc. in North Carolina.

The two branches of Carolina Federal Savings Bank reopened Monday under the Bank of North Carolina name and depositors at the failed bank will automatically become depositors at Bank of North Carolina.

All deposits will continue to be insured by the FDIC; customers of Carolina Federal Savings Bank do not need to switch banks.

As of March 31, Carolina Federal Savings Bank had $54.4 million in total assets and $53.1 million in total deposits. The FDIC estimates that the cost to the Deposit Insurance Fund will be $15.2 million.

Waccamaw Bank also closed Friday. It operated four locations in South Carolina: two in Conway, one in Little River and one in Heath Springs. Waccamaw’s deposits were assumed by First Community Bank of Bluefield, Va.

Carolina Federal Savings bank was the 26th FDIC-insured bank to fail nationwide this year. It was the second South Carolina bank to fail; Plantation Federal Bank in Pawleys Island closed on April 27.

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