Biggest Bank Failure in 2009 (so far): $20 billion of Deposits on the Move

According to Callahan & Associates research, a minimum of 15-20% of “sold” branch deposits find a new home during the year a merger or sale occurs. This suggests that between $3 to $4 billion dollars from the 346 branches will be looking for a new home due to the Colonial Bank failure.

 
 

On August 14th, the FDIC announced that Colonial Bank of Montgomery, Alabama had been closed and the FDIC named receiver.   BB&T, as part of the rescue, agreed to assume the $20 billion in deposits in the 346 Colonial Bank’s branches throughout Florida, Alabama, Nevada, Texas and Georgia.

The two tables below show details of Colonial’s June 2008 total deposits in these five states.    The second table drills down one more level to identify which county had the largest proportion of Colonial deposits within each state.

Colonial Bank Branch Information (as of June 30th, 2008)

State

Branches

Deposits (millions)

Market Share

Florida

198

$10,395

2.7%

Alabama

90

$5,656

7.4%

Nevada

20

$683

0.3%

Texas

18

$679

0.1%

Georgia

20

$607

0.3%

 

Colonial Bank Branch Information (as of June 30th, 2008)

County Most Effected

Branches

Branch Deposits (millions)

Miami-Dade (FL)

23

$1,851

Montgomery (AL)

6

$1,816

Clark (NV)

12

$367

Dallas (TX)

9

$506

DeKalb (GA)

3

$122

A Credit Union Opportunity?

According to Callahan & Associates research, a minimum of 15-20% of “sold” branch deposits find a new home during the year a merger or sale occurs.  This suggests that between $3 to $4 billion from the 346 branches will be looking for a new home due to the Colonial Bank failure.

There is an easy and quick way to find out how much your market can be affected by this change.  Using Branch Analyzer from Callahan’s any user can drill down for data right to the individual branch level.  From this detail one can find total deposits, local market share, and the rate of deposit growth over the past year. 

Using this data, a credit union can decide the size of opportunity that could be available and the effort to commit pursuing it.

For further information, please contact Sam Brownell at sbrownell@creditunions.com for full details of the Colonial’s data or for deposit information on any market.

 

 

 

Aug. 17, 2009


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