Office of the Commissioner of Financial Regulation

 

M&T Bank Acquires Troubled K Bank

 

(BALTIMORE, 11/5/10) - At 6:30 p.m. today, the Maryland Commissioner of Financial Regulation accepted possession of K Bank of Randallstown, Maryland, and caused the Federal Deposit Insurance Corporation ("FDIC") to be appointed as receiver of the K Bank. All of K Bank's deposits, as well as the majority of its assets, were immediately acquired by M&T Bank, a New York-chartered commercial bank, in a purchase and assumption transaction arranged by the FDIC.

All depositors of K Bank will automatically become depositors of M&T Bank. "K Bank's customers can expect a smooth transition," said Commissioner Mark A. Kaufman. "Depositors will not experience any loss or disruption in access to their accounts. M&T Bank is a strong institution with a demonstrated commitment to our region."

All K Bank branches will immediately reopen beginning tomorrow as usual for customers. Tonight and throughout the weekend, K Bank depositors can continue to access their funds by writing checks and utilizing their existing ATM and/or debit cards. K Bank has seven branches located in Randallstown, Perry Hall, Ellicott City, Eldersburg, Bel Air, Cockeysville, and Owings Mills.

"Marylanders should remain confident in the overall safety and soundness of our banking industry," said Commissioner Kaufman. "The overwhelming majority of our state-chartered banks are healthy and well capitalized. We work diligently with our counterparts at the FDIC and the Federal Reserve to ensure that our institutions operate safely, and to assist them in meeting the challenges of the current economic environment. Likewise, all bank deposits are insured by the FDIC up to $250,000."

As of September 30, 2010, K Bank had total assets of $538 million and total deposits of $500 million. K Bank was an aggressive commercial real estate lender and its capital was eroded by a high volume of nonperforming loans and loan losses, particularly related to acquisition, development and construction lending. Management was unsuccessful in efforts to sell or recapitalize the institution and, consequently, the Board of Directors voted to turn possession of the institution over to the Commissioner.

The FDIC has established a website and a toll-free number to answer questions from depositors, creditors, and other interested parties regarding its receivership of K Bank. The toll-free number is 1-800-830-4697. The phone number will be operational this evening until 9 p.m. Eastern Daylight Time ("EDT"); on Saturday from 9 a.m. to 5 p.m. EDT; on Sunday from 12 noon to 5:00 p.m. Eastern Standard Time ("EST"); and thereafter during regular business days from 8 a.m. to 5 p.m. EST.

The Office of the Commissioner of Financial Regulation is responsible for the supervision of Maryland chartered-banks, credit unions and trust companies, as well as non-depository financial service providers such as mortgage lenders. The Office of the Commissioner works to maintain the integrity of the Maryland financial services industry and protects the interests of depositors, borrowers, shareholders and consumers through effective regulation.

Questions or comments regarding the Commissioner of Financial Regulation may be directed to DLLR Public Affairs Specialist Shannon Davis at 410-230-6069.