Regulators closed First City Bank of Florida on Friday, making the Fort Walton Beach-based bank the third financial institution to fail in 2020.
The $134.7 million-asset bank experienced "longstanding capital and asset quality issues, operating with financial difficulties dating back to 2009," the Federal Deposit Insurance Corp. (FDIC) said in a statement Friday. The bank's financial difficulties were not related to current economic conditions resulting from the coronavirus pandemic, the regulator added.
Evansville, Indiana-based United Fidelity Bank will assume all of First City Bank of Florida's $131.4 million in deposits, the FDIC said.
In addition to assuming deposits, United Fidelity Bank agreed to purchase all of the failed bank's $134.7 million in assets, the FDIC said. First City Bank's two branches opened Saturday under the United Fidelity Bank name.
First City Bank had been on track to be acquired by Beach Community Bank, another Fort Walton Beach-based institution, in a deal announced in mid-January.
"This merger agreement represents an extremely desirable outcome for First City Bank as we faced the challenges of the Great Recession and the Deepwater Horizon oil spill," First City Chairman and CEO John McGee said in a statement in January.
The acquisition, however, fell through in March after Beach Community Bank terminated the deal citing the current economic environment.
First City Bank's failure is expected to cost the FDIC's Deposit Insurance Fund (DIF) $10 million, the regulator said.
First State Bank's closure cost the DIF about $46.8 million, while Ericson State Bank's failure cost the fund $14.1 million, according to the FDIC.