Briefing
How a bank failure ends: takeover or payout
Almost every bank failure ends in one of two ways: another bank takes over the deposits, or the FDIC pays insured depositors itself. Since 2000, 552 of the 583 failures (95%) were purchase and assumption deals with another bank, and only 23 were straight payouts. In the 1930s it was the other way round: 207 of the 312 failures of 1934 to 1939 ended in a payout.
The methods in the record
The FDIC's failure data codes each case by how it was resolved. In plain terms:
- Purchase and assumption. Another bank buys some or all of the assets and takes over the deposits, often over a weekend. A variant takes over only the insured deposits.
- Insured deposit transfer. Insured deposits move to another bank, which pays them out or keeps them as new accounts; the failed bank's assets stay with the FDIC.
- Payout. No bank takes the deposits and the FDIC pays insured depositors directly.
- Deposit insurance national bank. A temporary bank run by the FDIC to give depositors time to move their money. The record counts 8 since 2000; on this site they are grouped with payouts.
Uninsured deposits and other claims are paid, if at all, from what the receivership recovers. This site does not explain coverage rules; the FDIC's own deposit insurance pages do.
Decade by decade
| Decade | Failures | Purchase and assumption | Deposit transfer | Payout | Other |
|---|---|---|---|---|---|
| 1930s | 312 | 34% | 0% | 66% | 0% |
| 1940s | 99 | 62% | 0% | 38% | 0% |
| 1950s | 28 | 57% | 0% | 43% | 0% |
| 1960s | 44 | 39% | 0% | 61% | 0% |
| 1970s | 75 | 69% | 0% | 31% | 0% |
| 1980s | 1,466 | 64% | 21% | 12% | 4% |
| 1990s | 919 | 83% | 9% | 8% | 0% |
| 2000s | 197 | 92% | 0% | 8% | 0% |
| 2010s | 367 | 96% | 0% | 4% | 0% |
| 2020s | 19 | 100% | 0% | 0% | 0% |
"Other" covers assisted mergers and similar arrangements recorded for savings associations in the 1980s. Insured deposit transfers belong to the same era: the record shows 386 of them between 1980 and 1999 and none since.
Payouts since 2000
The payouts since 2000 cluster in the worst years: 4 in 2002, 8 in 2009, 6 in 2010, 3 in 2012. The most recent was The Community's Bank of Bridgeport, Connecticut, on September 13, 2013. Payout failures carried a median estimated loss of 23% of assets, against 22% for purchase and assumption deals, a difference of 1.9 percentage points. Year pages from 2000 on name the acquirer of every failure, or show that there was none.
The Friday closing
Closings are timed so that the acquirer can open the branches under its own name on the next business day. Since 2000, 556 of 583 failures (95%) happened on a Friday. Over the full record the share is lower, 50%; 1,057 of the failures from 1980 to 1994 closed on a Thursday. Each bank page gives the weekday of its closing in the line above the name.
To see one outcome only, the explorer can list every payout since 2000.
Size and outcome
Size made little difference to the outcome. Since 2000 the median failure that ended in a payout or a temporary deposit insurance national bank had $213 million in assets, against $195 million for failures taken over by another bank. The largest of them was Silverton Bank, NA of Atlanta, Georgia, with $4.2 billion.
Deposit insurance national banks since 2000
The record lists eight of them:
- New Frontier Bank of Greeley, Colorado, April 10, 2009
- Community Bank of Nevada of Las Vegas, Nevada, August 14, 2009
- Citizens State Bank of New Baltimore, Michigan, December 18, 2009
- Barnes Banking Company of Kaysville, Utah, January 15, 2010
- Waterfield Bank of Germantown, Maryland, March 5, 2010
- Enterprise Banking Company of McDonough, Georgia, January 21, 2011
- FirsTier Bank of Louisville, Colorado, January 28, 2011
- Bank of the Eastern Shore of Cambridge, Maryland, April 27, 2012
Insured deposits only
In 35 failures since 2000 the acquirer took over only the insured deposits. 27 of them came in 2008 or earlier, including IndyMac Bank, the largest.
Where payouts happened
Since 2000, payouts and deposit insurance national banks were spread over 14 states. The most were in Georgia (7), Utah (4), Michigan (3) and Illinois (3). The year pages from 2000 on carry an acquirer column, where "no acquirer" marks a payout.
Before the savings and loan years, payouts were common. Between 1940 and 1979 the record shows 100 payouts among 246 failures. From 2010 to 2026 the share fell to 4%, counting deposit insurance national banks. No failure since 2013 has ended in a payout.
Sources
Federal Deposit Insurance Corporation: BankFind Suite failures, institutions and financials data; Failed Bank List. All figures computed by this site from those records; see how to read the data.