As previously posted here at Shoegazing, the Fed shut down Community Banks of Colarado. This was actually a first, according the American Banker magazine.

Joe Adler at the magazine reported that:

The Fed, the federal regulator for hundreds of state-chartered banks in the U.S., before Friday had never used its authority to close a bank. Under prompt corrective action rules established at the end of the savings and loan crisis, the central bank has the power to put one of its so-called state member banks in receivership after it becomes “critically undercapitalized.” The Fed has 90 days to act after the bank reaches that status.

Further, Adler reports that this was a first because normally it is the state charters that close the bank:

But typically, for state-chartered institutions overseen by both the Fed and the FDIC, the task of closing a bank is left to the state as it is the chartering authority. It is unclear why the Fed acted on its own, but the move suggested an absence of state action.

Finally, this was one of the largest bank closures this year.

The failure, the nation’s 84th this year and the sixth in Colorado, was estimated to cost the FDIC nearly $225 million

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