by Calculated Risk on 2/13/2009 05:44:00 PM

From the FDIC: Heritage Bank, Wood River, Nebraska, Assumes All the Deposits of Sherman County Bank, Loup City, Nebraska

Sherman County Bank, Loup City, Nebraska, was closed today by the Nebraska Department of Banking and Finance, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Heritage Bank, Wood River, Nebraska, to assume all of the deposits of Sherman County Bank.
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As of February 12, 2009, Sherman County Bank had total assets of approximately $129.8 million and total deposits of $85.1 million. Heritage Bank will pay the FDIC a premium of six percent. In addition to assuming all of the deposits of Sherman County Bank, Heritage Bank agreed to purchase approximately $21.8 million in assets, comprised mainly of cash, cash equivalents and marketable securities. The FDIC will retain the remaining assets for later disposition.
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The FDIC estimates that the cost to the Deposit Insurance Fund will be $28.0 million. Heritage Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's Deposit Insurance Fund compared to alternatives. Sherman County Bank is the tenth bank to fail in the nation this year. The last institution to fail in Nebraska was Equitable Savings and Loan, Columbus, on February 16, 1990.

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