Two more Georgia banks closed by feds

WASHINGTON - Regulators on Friday shut down two small banks in Georgia, boosting to 42 the number of failures this year of federally insured banks.

The Federal Deposit Insurance Corp. was appointed receiver of the failed banks: Community Bank of West Georgia, based in Villa Rica, and Neighborhood Community Bank, located in Newnan. Community Bank of West Georgia had $199.4 million in assets and $182.5 million in deposits as of May 15. Neighborhood Community Bank had $221.6 million in assets and $191.3 million in deposits as of March 31.

They brought to 14 the number of banks in Georgia that have failed since the beginning of last year, more than in any other state. Most of the failures have involved banks in the Atlanta area, where the collapse of the real estate market brought economic dislocation.

CharterBank, based in West Point, Ga., agreed to assume all of the deposits of Neighborhood Community Bank and to purchase about $209.6 million of the assets; the FDIC will retain the remaining assets for later disposition. Neighborhood Community's four offices will reopen as branches of CharterBank.

The FDIC said it will mail checks to Community Bank of West Georgia depositors for the amounts of their insured funds. Direct deposits from the government, such as Social Security and veterans' benefits, will be transferred to United Community Bank in Blairsville, Ga.

The 42 banks closed nationwide this year compare with 25 in all of 2008 and three in 2007.