Closing Bank of Elmwood

In an effort to protect the patrons, FDIC immediately appointed a bank receiver. This time, it’s Tri City National Bank in Oak Street. Tri City will assume all deposits and depositors from Bank of Elmwood.

Therefore, the five branches of Bank of Elmwood including Racine and Kenosha will reopen. However, all depositors will already be owned by Tri City. According to Lorrie Keating Heinemann, Secretary of Department of Financial Institutions, “We’re pleased that Tri City National, a strong Wisconsin Bank, will continue to provide all banking services for depositors of Bank of Elmwood.”

As of September 30, Bank of Elmwood had $327.4 million in total assets and $273.2 million in total deposits. Tri City also agreed to purchase all assets in addition to saving the depositors of the failed bank. According to estimates from FDIC federal officials, the cost is about $101.1 million but compared to other alternatives, this was the “least costly” one. In fact, Tri City didn’t pay a premium to FDIC for Bank of Elmwood deposits.

Chief Executive Officer and Chairman of Bank of Elmwood, Jess Levin, said that the economy should be blamed for the bank’s struggles and difficulties to meet the requirements. Levin also added in a released statement that the bank’s customers consist mostly of minority businesses and blue collar workers who are being hurt due to recession.