October 15, 2010

Premier Bank, Jefferson City, acquired by Providence Bank, Columbia

Jefferson City, Mo. - The Missouri Division of Finance today accepted possession of Premier Bank, Jefferson City, and appointed the Federal Deposit Insurance Corp. (FDIC) as receiver. To protect depositors, an agreement to acquire the bank was reached with Providence Bank, a $170 million state bank headquartered in Columbia, Mo.

Depositors of Premier Bank automatically become depositors of Providence Bank, and continue to have full access to their money by writing checks or using ATM or debit cards.  Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual. 

Depositors will continue to be fully insured by the FDIC. Lobby and drive-up services will resume at all eight Missouri locations in Jefferson City, Osage Beach, Chesterfield, Lake St. Louis, St. Charles and St. Peters tomorrow morning. Normal services at the Grapevine, Tex., branch will resume on Monday, October 18.

"There will be no interruption of services for customers of the former Premier Bank," said Richard J. Weaver, Commissioner of the Division of Finance. "The demise of this bank is the result of aggressive lending decisions made by management. Many of the loans were in commercial real estate and development projects which proved unsuccessful. These loans became uncollectible.

"Losses are more than the bank can support and management acknowledges that failure of the bank is inevitable. The bank has operated under close regulatory scrutiny since December of 2007," Weaver said. 

Attempts by management to sell the bank or obtain additional capital were not successful, and as a result the bank's board of directors voted to turn the bank over to the Missouri Division of Finance, as allowed by state law, Weaver said. Assets of the bank totaled $989 million as of September 30.           

Customers who have questions about today's transaction can call the FDIC toll free at 1-800-591-2820. The phone number will be operational this evening until 9; on Saturday from 9 a.m. to 6 p.m.; on Sunday from noon to 6 p.m.; and thereafter from 8 a.m. to 8 p.m.