Chicago lender Metropolitan Capital Bank & Trust failed Friday, becoming the first bank failure of 2026.
The Illinois Department of Financial and Professional Regulation closed the single-branch bank and appointed the Federal Deposit Insurance Corp. as receiver, the agencies said.
Detroit-based First Independence Bank entered an agreement with the FDIC to assume substantially all $212.1 million of Metropolitan Capital’s deposits, and $251 million of its $261.1 million in assets.
“We want to be clear that no depositor will lose any money as a result of this action,” Susana Soriano, acting director of IDFPR’s Division of Banking, said in a prepared statement.
Metropolitan Capital was closed due to unsafe and unsound conditions and an impaired capital position, Soriano said, and First Independence Bank is “well-positioned to continue essential banking services” for the failed bank’s customers.
The failure will result in a $19.7 million hit to the FDIC’s Deposit Insurance Fund, and the cost will change as retained assets are sold, the agency said.
Metropolitan Capital was founded in 2005 by CEO Frank Novel, Executive Vice President Jerry Frump, Chief Lending Officer Dick Keneman and Michael Rose.
Rose served as CEO of the bank until July, when he left the bank to open capital advisory firm Affinitas Capital, according to his LinkedIn profile. Novel had served as president under Rose.
Since its founding, Metropolitan Capital provided commercial banking, investment banking, private banking and wealth consulting services to small- to medium-sized businesses across 46 states and 10 countries, according to its website.
Its acquirer, First Independence, said last year that it was the seventh-largest Black-owned bank in the U.S. Its assets rose from just over $200 million in 2020 to more than $500 million last year, according to a press release. CEO Kenneth Kelly was named chair of the American Bankers Association in October.
Metropolitan Capital is the first bank to fail in 2026. Last year saw the failure of two banks: Pulaski Savings Bank, based in Chicago and The Santa Anna National Bank, headquartered in Texas.
Likewise, 2024 saw two bank failures: First National Bank of Lindsay, based in Oklahoma, and Republic First in Philadelphia.
Five banks failed in 2023, including the springtime collapses of Silicon Valley Bank, Signature Bank and First Republic Bank, which in rapid succession were the third-, fourth-, and second-worst bank failures in U.S. history.
Metropolitan Capital customers will experience no interruption. Its sole branch reopened Monday as a branch of First Independence, and all depositors automatically became First Independence depositors, bank regulators said. Over the weekend, customers had immediate access to their deposits through checks, ATM transactions and debit cards.
The FDIC declined to comment on Metropolitan Capital’s failure. First Independence did not respond to a request for comment.
