Two Banks Fail In Midwest; Total Count Reaches 15

New York, NY (AHN) - Banks in Illinois and Michigan were seized by the state regulators, pushing up the number of failed financial institutions to 15, according to the officials.

The Northville, Michigan-based Main Street Bank and the Eldred, Illinois-based Meridian Bank, both totaling $123 million in deposits, were taken over by their respective regulators and the Federal Deposit Insurance Corporation (FDIC) on Friday.

The Hillsboro, Ill.-based National Bank has agreed to purchase around $7.55 million of Meridian's assets, which is out of total $39.18 million and $36.88 million in total deposits as of September 25, 2008.

While, the Monroe, Mich.-based Monroe Bank & Trust has agreed to pay a total premium of 1 percent for the failed Main Street Bank's deposits, which are worth $86 million in total.

In addition, Monroe Bank & Trust will purchase approximately $16.9 million of Main Street's assets, Which are worth $98 million in total.

"Monroe Bank & Trust will have a 90-day option to purchase approximately $1.1 million in premises and fixed assets," the FDIC said in a statement.

The FDIC said it will retain the remaining assets for later disposition.

The regulator added that the customers of both the banks can access their money by writing checks or using ATM or debit cards over the weekend. Checks drawn on the bank will continue to be processed.

According to FDIC, accounts worth more than $100,000 per deposit per bank are not insured. The regulator does not cover accounts including annuities, mutual funds, life-insurance policies, stocks and bonds.

Reports claim that the FDIC has more than 100 banks-at-risk on its watch list but will not disclose information as it could trigger panic among their customers.

With the current number of banks managed by FDIC and to support potential banks-at-risk after collapsing, the government's agency would require additional $150 billion to bail them out.