Neighborhood Community of Newnan seized - Atlanta Business Chronicle:

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, based in West Point, Ga., will assum all of Neighborhood Community’ds $191 million in total deposits, and will take on $209 millionn of the failed bank’s assets, according to a release. Neighborhoocd Community’s loan and deposit customers will automatically become CharterBank The FDIC and CharterBanl entered intoa loss-share transaction, a method that is becoming a common vehicle for the FDIC to unloads failed banks. Under the deal, the regulator will absorb losses on as muchas $171 milliojn of the assets purchased by CharterBank.
The deposit insurer stated in a releaswe the deal will be the least costly forthe FDIC’sd insurance fund and will minimize disruption for loan customers. The FDIC estimate s the cost of the failurd to the insurance fund willbe $66.7 Neighborhood Community opened in April and operated four offices throughout the south metrk in Newnan, Tyrone and Peachtree City. The branchesd will re-open Monday as CharterBank branches, and will permanentlgy become CharterBank branches. Robert Johnson, CharterBank CEO, said the acquisition was an extensionj ofhis bank’s West Georgi market closer to along the Interstate 85 corridor.
CharterBank is headquarterecd nearthe Alabama/Georgia border along I-85, and operates branches throughoutg the border region. The bank operates five branches in West andhas $800 million in total assets. Johnson said his bank wouldr continue to look at otheer distressed banks along the corridotr toadd branches, deposits and loanx as a path for growth. “Customerd should know that it will be business as usuall for both their deposits and Johnson said, noting two branches will be open tomorrosw for customers. The list of Atlanta-area banks felled by bad bets on real estatd loans continuesto swell.
As of firsft quarter 2009, Neighborhood Community reportex $163 million in total loans, but one-third of thosde loans were in some stageof default, foreclosure or repossession by the The bank reported only $5.2 million in total which could not absorb the potential losses on $15 million in foreclosed real and $31 million in loans that appeared unlikely to be At the time of its the bank had a Texas Ratio of 346 The ratio has became a common industryt metric in the S&L Crisis, and measureds total loan problems to equity or the size of the bank’a problems with its ability to absorbb the losses.
Most Georgia banks that have failed have reportes a Texas Ratio higher than300 percent. Earlier Friday, state banking regulators seizerVilla Rica-based Community Bank of West No bidder was found for Community Bank’s operatione — one branch in the Atlanta suburh — and the bank will be