FDIC Closes First Priority Bank of Florida

These are scary times for the banking industry. A small bank in Florida by the name of First Priority Bank has been shut down by the FDIC.

First Priority Bank with six branches on Florida’s Gulf Coast was closed by state regulators, becoming the eighth US bank to collapse this year amid failed loans and writedowns linked to a slump in home prices.

First Priority, with US$259 million in assets, was shut on Friday by the Florida Office of Financial Regulation, and the Federal Deposit Insurance Corp (FDIC) sold US$227 million in deposits to SunTrust Banks Inc of Atlanta, the agency said in a statement. Six First Priority branches in Bradenton, Sarasota and Venice will open tomorrow as SunTrust offices, the FDIC said.

The credit crunch is FAR from over. This is only the tip of the iceberg.