Security Savings Bank shut down

Henderson-based Security Savings Bank was shut down by banking regulators Friday and will reopen Monday as branches of Bank of Nevada.

Andrew Gray, spokesman for the Federal Deposit Insurance Corp., said Las Vegas-based Bank of Nevada will acquire all of the failed bank's deposits, totaling $175.2 million on Dec. 31.

"The insured and the uninsured have been acquired so no one has lost any money that is deposited at the bank even if you're over the deposit insurance limits," Gray said.

The FDIC last year increased its coverage of insurance to $250,000 for most deposits.

The bank's customers will be able to access their accounts this weekend by writing checks or using automated teller machines or debit cards, a statement from the FDIC read.

Checks drawn on the bank will continue to be processed. Security Savings' loan customers should continue to make payments as usual, the federal agency said.

"It will be a smooth transition and business as usual for customers," Gray said.

Nevada Financial Institutions Division closed the bank's two offices, and appointed the FDIC as receiver.

The FDIC, in turn, sold the deposits to Bank of Nevada. Bank of Nevada agreed to purchase $111.3 million of Security Savings Bank's assets.

The FDIC will retain the remaining assets, which totaled $238.3 million on Dec. 31, for later sale or liquidation.

The FDIC estimates the cost to the deposit insurance fund will be $59.1 million.

Securities Savings Bank's loan portfolio, which had a high volume of acquisition, development and construction loans, deteriorated with the downturn in the economy. The bank's losses swelled from $1.9 million at the end of 2007 to $28.5 million last year, according to the FDIC.

"The losses eroded their capital and they just weren't able to stay in business," Gray said.

Dale Gibbons, chief financial officer of Western Alliance Bancorporation, the holding company for Bank of Nevada, said: "We see this as an opportunity to expand our relationships (with customers) in Nevada at no premium."

Bank of Nevada obtained the deposits from the FDIC without paying a premium to the amount of the deposits.

Jesse Torres is listed as the bank's president and Mark DeBacker is listed as secretary-treasurer on the Nevada secretary of state's Web site.

Security Savings' closure is the 16th bank failure of 2009 and the first bank closure in Nevada since Washington Mutual was shut down Sept. 25.

Twenty-five U.S. banks failed last year -- including two of the biggest thrifts -- more than in the previous five years combined and up from only three failures in 2007.

It is the third Nevada bank to fail since last year. First National Bank of Nevada was seized in July and Silver State Bank was shut down in September.

Contact reporter Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3893. The Associated Press contributed to this report.