The Office of the Comptroller of the Currency (OCC) shut down Illinois’ GreenChoice Bank, including the Logan Square location (2545 W. Diversey Ave.) July 25. The Federal Deposit Insurance Corporation (FDIC) was named the Receiver, according to the FDIC website.
GreenChoice Bank’s three branches reopened as Providence Bank, LLC branches Saturday, according to FDIC spokesman Greg Hernandez. Providence Bank is based out of South Holland and had nine previous branches with six in Illinois and three in Indiana.
All services including ATM and online services, safe deposit boxes, night deposit boxes and wire services will remain available, according to the FDIC website.
In addition to checking accounts, GreenChoice offered Certificates of Deposit, car loans, business checking accounts, commercial loans an Social Security direct deposits.
‘Unsafe and Unsound’ Practices Led to Closing
Banks can be closed for a variety of reasons, but the OCC released the following statement regarding the closure of GreenChoice:
“The OCC acted after finding that the institution had experienced substantial dissipation of assets and earnings due to unsafe and unsound practices. The OCC also found that the institution incurred losses that depleted its capital, the institution is critically undercapitalized, and there is no reasonable prospect that the institution will become adequately capitalized.”
As far as Providence Bank taking over, no notice had to be given to the public before the institution was closed, and “customers of GreenChoice Bank, fsb should continue to use their existing branch until they receive notice from Providence Bank, LLC that it has completed systems changes to allow other Providence Bank, LLC branches to process their accounts as well,” according to the FDIC press release.
When a bank seems to be on the brink of closure, the FDIC ensures the process will be smooth for those using the bank.
“It’s a seamless process that and it’s made that way so that people will continue their banking without disruption,” says Hernandez.
“The FDIC has to select the winning bid and that means that once a regulator notifies the FDIC a bank will close, the FDIC has 90-100 days to confidentially market the bank and it will market the bank to regional banks or people interested in receiving,” says Hernandez. “The FDIC selects the winning bid that leads to the least cost to the deposit insurance fund (DIF),” explains Hernandez.
The FDIC estimates this resolution will be $14.2 million to the DIF.
GreenChoice is this year’s 14th bank failure, which is an improvement on the year-to-date count as 2013 had seen 24 bank failures by July 25. Bank failures have been decreasing since they peaked in 2010 with a total of 157 bank failures.
Out of the 14 failed banks to date, four of them have been from Illinois.
Editor’s note: LoganSquarist holds a business account with GreenChoice Bank.