Likelihood of bank failures in Florida rises
The number of problem banks in Florida grew to 67 in the fourth quarter, according to a ratings agency.
BY JEFF HARRINGTON
St. Petersburg Times
The roster of severely troubled Florida banks jumped more than 70 percent in the fourth quarter, increasing the likelihood of more bank failures, according to ratings agency Bauer Financial.
In early 2006, when the housing boom was at its apex, federal regulators noted it was the first time in history that more than 50 percent of Florida's community banks held construction and development loans exceeding 100 percent of the bank's capital.
In Bauer's rating hierarchy, a five-star bank is very healthy, a three-star bank is OK and two stars or fewer indicate problems.
The number of problem banks statewide -- two stars or below -- swelled from 52 to 67. And the damage could have been worse.
Not included in that tally are two banks that have failed since the last quarter: Ocala National Bank in Ocala and Riverside Bank of the Gulf Coast in Cape Coral.
''We knew year-end was going to be a messy quarter, and it was,'' said Karen Dorway, Bauer's president and director of research.
Accounts in a bank insured by the Federal Deposit Insurance Corp. are protected to a point. Congress has temporarily increased FDIC deposit insurance from $100,000 to $250,000 per depositor through Dec. 31.
A takeover by the FDIC is the most dramatic way of dealing with a weakened bank. Or a stronger bank may step in with a merger.
An Alabama insurance company earlier this year agreed to buy Bank of Bonifay, one of the zero-stars on Bauer's list.
Banking outlook
South Florida's five-star banks
American National Bank, Oakland Park
City National Bank of Florida, Miami
First Bank of Miami, Coral Gables
First National Bank of South Miami, South Miami
Intercontinental Bank, West Miami
Zero-star banks
Bank United FSB, Coral Gables
Key West Bank, Key West
Ocean Bank, Miami
Premier American Bank, Miami
Republic Federal Bank N.A., Miami
Source: Bauer Financial
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