Regulators Close Two Banks in Georgia

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U.S. regulators closed two Georgia banks on Friday, bringing the total number of closures this year to 70.

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The Federal Deposit Insurance Corp announced that the deposits of both banks were being assumed by Georgia Commerce Bank in Atlanta.

The two institutions closed were Patriot Bank of Georgia, located in Cumming. and CreekSide Bank, located in Woodstock.

As of June 30, Patriot Bank had $150.8 million in assets and CreekSide had $102.3 million in assets, the FDIC said.

The banks' branches will open on Tuesday, after the Labor Day holiday, as branches of Georgia Commerce Bank.

Of the 70 banks that have failed this year, 19 have been in Georgia.

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The FDIC expects the total number of failures this year to be below the 2010 level of 157 as the industry continues to rebound from the 2007-2009 financial crisis.

This year's bank failures, however, illustrate the problems that continue to face small community banks, many of which are hard hit by the sluggish economy and their exposure to the troubled commercial real estate market.

Most of the banks that have failed so far this year have had less than $1 billion in assets.
The overall outlook for the industry has been improving in recent quarters but there are still signs of trouble.

The industry earned $28.8 billion in the second quarter, a $7.9 billion increase from a year before, the FDIC announced on August 23.

These increased profits, however, continue to be based on setting aside less to guard against losses rather than revenue growth.