Rolling Meadows bank closure surprises city officials

Customers of Rolling Meadows' Platinum Community Bank were caught off guard by the bank's sudden closure - even though FDIC officials were on hand Saturday to reassure them that their money was safe.

Federal regulators shuttered the bank Friday along with four others nationwide.

"It's definitely shocking, there is no doubt about that," Rolling Meadows City Manager Sarah Phillips said. "We weren't aware of any problems they were having."

The Federal Deposit Insurance Corporation, or FDIC, will be paying out the bank's insured accounts - those of $250,000 or less per individual account. The bank's total deposits amount to $305 million. The FDIC will mail customers checks for their insured funds on Tuesday, Sept. 8, according to a news release.

Rolling Meadows Mayor Kenneth Nelson is urging customers of the nearly 10-year-old defunct bank to remain calm.

"I think the important thing for (customers) to remember is you should not worry about it," Nelson said Saturday. "Don't panic about it. The FDIC will let them know what they need to do and their accounts are insured. They are not going to lose their money. This is not the first time this has happened to a bank."

Fifteen Illinois banks and a total of 89 banks nationwide have failed in 2009.

Customers trickled into Platinum Community Bank's Kirchoff Road location Saturday and were greeted by FDIC representatives who were there to answer questions.

Sherry Frank, who lives a few blocks away from the bank, said she has been banking there for years.

"I'm concerned about our money because it's our livelihood," Frank said. "If we can't access our money then we're paralyzed. I thought small banks were safe. This kind of reminds me of the 1930s."

Richard Schmalzer, regional ombudsman for the FDIC, reassured Frank that no matter how many banks failed, it wouldn't put a strain on the FDIC and customers' insured deposits would still be covered.

"We do have an insurance fund funded by the (banking) industry," Schmalzer said. "We have a line of credit with the U.S. Treasury for $500 billion. You are backed by the full faith and credit of the federal government. The good news is nobody's losing money. The checks will be in the mail Tuesday morning."

Schmalzer said the full amount of customers' deposits with interest as of Friday will be paid back.

"Many people are surprised that they don't have to fill out forms," he said.

That applies to most accounts, but there are a few exceptions such as larger accounts and trust accounts that may need an insurance determination, he added.

As of Aug. 29, 2009, Platinum Community Bank had total assets of $345.6 million, according to the FDIC news release. The bank's parent company, Taylor, Bean & Whitaker Mortgage Corp., recently filed for bankruptcy.

FDIC spokesman David Barr said he couldn't comment on why the bank failed as the decision to close it is actually made by the Office of Thrift Supervision, which then appoints the FDIC as receiver.

The FDIC estimates the cost of the failure to its Deposit Insurance Fund to be roughly $114.3 million.

Platinum Community Bank customers receiving direct deposits from the federal government such as Social Security and veteran's payments will still be able to access those deposits at MB Financial Bank's Palatine branch, 2251 Plum Grove, Barr said.

For more information, customers can call FDIC toll free at (800) 640-2751 from noon to 6 p.m. today and from 8 a.m. to 8 p.m. on normal business days, or visit www.fdic.gov/bank/individual/failed/platinum-il.html.