Weiss Ratings: Six Failed Banks Identified as “Weak” by Weiss over Two Years Ago

JUPITER, Florida (April 18, 2011) — On Friday, regulators closed six banks: New Horizons Bank, East Ellijay, Georgia; Bartow County Bank, Cartersville, Georgia; Nexity Bank, Birmingham, Alabama; Rosemount National Bank, Rosemount, Minnesota; Heritage Banking Group, Carthage, Mississippi; and Superior Bank, Birmingham, Alabama.    This brings the total number of U.S. bank and thrift failures to 34 for 2011, behind last year’s pace of 50. 

New Horizons Bank, East Ellijay, Georgia, north of Atlanta, with assets of $110.7 million at December 31, 2010 had been rated E- (“Very Weak”) for the last five quarters by Weiss Ratings and was first identified as “Weak” in June 2008 based on first quarter 2008 data.  It reported a loss of more than $6.9 million through December 31, 2010.  New Horizons Bank had well below-FDIC-mandated Tier 1 (5%) and risk-based capital (6%) ratios of 0.26% and 0.75%, respectively.  Nonperforming loans represented 10.1% of its loan portfolio.  Citizens South Bank, Gastonia, North Carolina, with assets of over $1 billion and a Weiss Financial Strength Rating of “D” will assume the deposits of New Horizons Bank. 

Bartow County Bank, Cartersville, Georgia, located north of Atlanta, with assets of $330.2 million at December 31, 2010 had been rated E- (“Very Weak”) for the last five quarters by Weiss Ratings and was first identified as “Weak” in June 2008 based on first quarter 2008 data.  It reported a loss of more than $6.7 million through December 31, 2010.  Bartow County had well below-FDIC-mandated tier 1 (5%) and risk-based capital (6%) ratios of 0.71% and 2.16%, respectively.  Nonperforming loans represented 16.2% of its loan portfolio.  Hamilton State Bank, Hoschton, Georgia, with assets of over $244.9 million and a Weiss Financial Strength Rating of “D-” will assume the deposits of Bartow County Bank. 

Nexity Bank, Birmingham, Alabama, with assets of $912.8 million at December 31, 2010 had been rated E- (“Very Weak”) for the last five quarters by Weiss Ratings and was first identified as “Weak” in September 2008 based on second quarter 2008 data.  It reported a loss of more than $22.4 million through December 31, 2010.  Nexity Bank had well below-FDIC-mandated tier 1 (5%) and risk-based capital (6%) ratios of 0.72% and 2.47%, respectively.  Nonperforming loans represented 16.9% of its loan portfolio.  Alostar Bank of Commerce, Birmingham, Alabama, a newly formed entity, with no assets or Weiss Financial Strength Rating prior to the acquisition, will assume the deposits of Nexity Bank. 

Rosemount National Bank, Rosemount, Minnesota, located south of Minneapolis, with assets of $37.6 million at December 31, 2010 had been rated E- (“Very Weak”) for the last five quarters by Weiss Ratings and was first identified as “Weak” in June 2007 based on first quarter 2007 data.  It reported a loss of more than $1.8 million through December 31, 2010.  Rosemount National had below-FDIC-mandated tier 1 (5%) and risk-based capital (6%) ratios of 1.87% and 4.15%, respectively.  Nonperforming loans represented 9.3% of its loan portfolio.  Central Bank, Stillwater, Minnesota, with assets of over $777.1 million and a Weiss Financial Strength Rating of “C+” will assume the deposits of Rosemount National Bank. 

Heritage Banking Group, Carthage, Mississippi, located northeast of Jackson, with assets of $224.3 million at December 31, 2010 had been rated E- (“Very Weak”) for the last five quarters by Weiss Ratings and was first identified as “Weak” in June 2007 based on first quarter 2007 data.  It reported a loss of more than $10.4 million through December 31, 2010.  Heritage Banking Group had below-FDIC-mandated tier 1 (5%) and risk-based capital (6%) ratios of 2.24% and 3.98%, respectively.  Nonperforming loans represented 10.9% of its loan portfolio.  Trustmark National Bank, Jackson, Mississippi, with assets of over $9.4 billion and a Weiss Financial Strength Rating of “C” will assume the deposits of Heritage Banking Group. 

Superior Bank, Birmingham, Alabama, with assets of $3 billion at December 31, 2010 had been rated E- (“Very Weak”) for the last three quarters by Weiss Ratings and was first identified as “Weak” in January 2008 based on third quarter 2007 data.  It reported a loss of more than $232.1 million through December 31, 2010.  Superior Bank had below-FDIC-mandated tier 1 (5%) and risk-based capital (6%) ratios of 1.41% and 3.49%, respectively.  Nonperforming loans represented 11.6% of its loan portfolio.  Superior Bank, NA Houston, Texas, a subsidiary of Community Bancorp, LLC, a newly formed entity, with no assets or Weiss Financial Strength Rating prior to the acquisition, will assume the deposits of Superior Bank. 

Weiss rates 480 banks and thrifts an E+, E, or E-.  Consumers can view the full list at www.weissratings.com.

Weiss Ratings, the nation’s leading independent provider of bank, credit union and insurance company financial strength ratings, accepts no payments for its ratings from rated institutions.  It also distributes independent investment ratings on the shares of thousands of publicly traded companies, mutual funds, closed-end funds and ETFs.