From AP - News Headlines -

Strategic Capital Bank of Champaign Reopens Under New Owners After Govt Takeover

Champaign's Strategic Capital Bank re-opens Tuesday today under new ownership. State banking regulators closed the ten-year-old bank on Friday, and handed it over to the Federal Deposit Insurance Corporation. Today (Tuesday), the bank reopens as a branch of Effingham-based Midland States Bank. All deposits and loans are being transferred to Midland States Banks, and officials say customers should see no disruptions in service.

FDIC spokesman David Barr says Strategic Capital apparently ran into financial trouble due to its buying so-called private label mortage-backed securities and making commercial real estate loans. He says that left the bank vulnerable when the housing market and economy suffered a downturn, with home loans and commercial real estate loans taking the biggest hit."And with this bank having a lot of its assets concentrated in those two areas, it had a really adverse impact on their financial condition", says Barr.

Barr says the FDIC will keep a toll-free phone number open this week for former Strategic Capital customers with questions about the bank takeover. Calls will be taken from 8 AM to 8 PM, at 1-866-954-9527. That's 1-866-954-9527.

Besides Strategic Capital bank, state banking regulators shut down Citizens National Bank of Macomb last Friday. That makes a total of five bank failures in Illinois so far this year.

Categories: Business, Economics