NBRS Financial, Rising Sun, Maryland, was closed (October 17) by the Maryland Office of the Commissioner of Financial Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Howard Bank, Ellicott City, Maryland, to assume all of the deposits of NBRS Financial.
The five branches of NBRS Financial reopened as branches of Howard Bank on Saturday morning, October 18.
The bank was founded in 1880 as a national bank. It changed its charter to a state bank in 2002.
The bank was closed after it failed to find additional capital to restore it to sound condition, said Gordon M. Cooley, Maryland's acting Commissioner of Financial Regulation.
Depositors of NBRS Financial automatically became depositors of Howard Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of NBRS Financial should continue to use their existing branch until they receive notice from Howard Bank that it has completed systems changes to allow other Howard Bank branches to process their accounts as well.
(Friday) evening and over the weekend, depositors of NBRS Financial can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.
As of June 30, 2014, NBRS Financial had approximately $188.2 million in total assets and $183.1 million in total deposits. Howard Bank will pay the FDIC a premium of 1.19 percent to assume all of the deposits of NBRS Financial. In addition to assuming all of the deposits of the failed bank, Howard Bank agreed to purchase essentially all of the assets.
Customers with questions about the transaction should call the FDIC toll-free at 1-(800) 930-1848. The phone number will be operational Saturday from 9:00 a.m. to 6:00 p.m., EDT; on Sunday from noon to 6:00 p.m., EDT; on Monday from 8 a.m. to 8 p.m., EDT; and thereafter from 9:00 a.m. to 5:00 p.m., EDT. Interested parties also can visit the FDIC's Web site at https://www.fdic.gov/bank/individual/failed/nbrs.html.
The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $24.3 million. Compared to other alternatives, Howard Bank's acquisition was the least costly resolution for the FDIC's DIF. NBRS Financial is the 15th FDIC-insured institution to fail in the nation this year, and the second in Maryland. The last FDIC-insured institution closed in the state was Slavie Federal Savings Bank, Bel Air, on May 30, 2014.