A 116-year-old Kansas bank that survived two world wars and the Great Depression was the first federally insured bank to fail in the last five months.
The Office of the State Bank Commissioner of Kansas on Friday seized control of The Farmers and Merchants State Bank of Argonia and shut it down.
Based in Argonia, Kansas,
the financial institution was originally established in 1901. As of its demise, there were just 16 employees on the payroll.
Published reports indicate that the bank was closed after
an ongoing review determined it was insolvent and unable to meet its creditors’ demands
The state handed Farmers and Merchants over to the Federal Deposit Insurance Corp. as conservator. In turn, the FDIC held a secret bidding process and awarded the
winning bid to Conway Bank, which assumed all of the failed bank’s $30 million in deposits at a 2.5 percent premium.
Conway Bank additionally acquired all of Farmers and Merchant’s $34 million in assets — including
$6 million in one-to-four-family residential loans and $1 million in construction-and-land-development loans.
The FDIC estimates that Farmers and Merchants’ failure will cost its Deposit Insurance Fund $2.6 million.
Farmers and Merchants’
was the seventh bank failure of 2017 — bringing to 21 the number of mortgage-related businesses tracked by Mortgage Daily to close or fail so far this year.
