O.T. U.S. Shuts Bank for fraud?

greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread

This turned up on AOL: U.S. Shuts West Virginia Bank, Suspects Fraud

WASHINGTON (Reuters) - U.S. bank regulators said Wednesday they had closed the First National Bank of Keystone, West Virginia after finding evidence of an apparent fraud that had depleted the bank's capital.

The Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency took the action after finding $515 million in loans still being carried on the bank's books that should have been removed after they were securitized and sold, the agencies said. As of June 30, Keystone reported around $1.1 billion in assets and $881 million in deposits.

The FDIC will try to find a healthy bank to assume Keystone's deposits by Sept. 7. If this is not possible, it will move immediately to make available depositors' funds up to the statutory deposit insurance limit of $100,000.

The agency expects to make an announcement on the outcome of its efforts in the next few days.

Keystone's failure is the fourth this year of an insured U.S. bank, and the first in West Virginia since 1991.

The FDIC was created after the Depression to restore public confidence in the U.S. banking system. It monitors the soundness of U.S banks and thrifts and backs customers' deposits.

12:17 09-01-99

Copyright 1999 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. All active hyperlinks have been inserted by AOL.

-- Claire (readingaol@aol.com), September 01, 1999


Hmmm.... bank closed.... had depleted the bank's capital..... $1.1 billion in assets and $881 million in deposits.

Just a small local bank. No story here. Move along.. move along.

Hmmm. Just a minute! I can't get the link to open: http://www.fnbkeystone.com/, but hear's the info about the link:

Welcome To Keystone Bank! The First National Bank of Keystone led the nation in 1994, 1995, and 1996 as being the #1 BANK IN THE NATION for earnings on assets and earnings on... URL: www.fnbkeystone.com/ Last modified 22-Sep-98 - page size 2K

Closed huh?

I also can't get this link to open, but here's what altavista.com says about the page about the year 2000 and FNBK:

Year 2000 The First National Bank of Keystone (FNBK) is well informed on the Year 2000 issues. FNBK has taken a pro-active approach to the Year 2000 problem and... URL: www.kmc1.com/fnbk/year2000.htm Last modified 14-Apr-99 - page size 5K

bummer... Stocks down 80%

So.... was it the Keystone cops who closed the bank? [couldn't resist]

-- Linda (lwmb@psln.com), September 01, 1999.

Moderation questions? read the FAQ