Silver State Bank
Encyclopedia
Silver State Bank was a failed Nevada
commercial bank
with 17 branches in the Las Vegas
and Phoenix
metropolitan areas and loan operations across the western United States. The bank's assets were acquired by Zions Bancorporation
, a bank holding corporation with $2 billion in assets.
On September 5, 2006, Silver State Bancorp, the bank's holding company, acquired Choice Bank in the Phoenix/Scottsdale region of Arizona, and merged operations in 2008.
(FDIC) receivership. Nonbrokered FDIC-insured accounts in Nevada were transferred to Nevada State Bank, while those in Arizona were transferred to National Bank of Arizona, both of which are operating subsidiaries of Zions Bancorporation. The bank was the 11th insured commercial bank to fail in 2008, compared to three in all of 2007. An estimated $450 to $550 million in losses are expected to be covered by the FDIC Deposit Insurance Fund. Some customers who did not understand FDIC insurance limits sustained losses of deposits they believed safe. Uninsured deposited amounted to $20 million in 500 accounts.
The underlying cause of failure was overexposure to risky real estate loans, especially mortgages on undeveloped land purchased for home construction that was no longer viable following the collapse of the housing bubble
.
, sat on the board of Silver State Bank for five months in 2008, resigning on July 26 for "personal reasons," shortly before he would have had to sign off on second-quarter audit statements.
Nevada
Nevada is a state in the western, mountain west, and southwestern regions of the United States. With an area of and a population of about 2.7 million, it is the 7th-largest and 35th-most populous state. Over two-thirds of Nevada's people live in the Las Vegas metropolitan area, which contains its...
commercial bank
Commercial bank
After the implementation of the Glass–Steagall Act, the U.S. Congress required that banks engage only in banking activities, whereas investment banks were limited to capital market activities. As the two no longer have to be under separate ownership under U.S...
with 17 branches in the Las Vegas
Las Vegas, Nevada
Las Vegas is the most populous city in the U.S. state of Nevada and is also the county seat of Clark County, Nevada. Las Vegas is an internationally renowned major resort city for gambling, shopping, and fine dining. The city bills itself as The Entertainment Capital of the World, and is famous...
and Phoenix
Phoenix, Arizona
Phoenix is the capital, and largest city, of the U.S. state of Arizona, as well as the sixth most populated city in the United States. Phoenix is home to 1,445,632 people according to the official 2010 U.S. Census Bureau data...
metropolitan areas and loan operations across the western United States. The bank's assets were acquired by Zions Bancorporation
Zions Bancorporation
Zions Bancorporation is a member of the S&P 500, a bank holding company headquartered in Salt Lake City, Utah, USA. Among its subsidiaries are Amegy Bank of Texas, California Bank & Trust, National Bank of Arizona, Nevada State Bank, the Commerce Bank of Oregon, the Commerce Bank of Washington,...
, a bank holding corporation with $2 billion in assets.
History
Silver State Bank was a community bank founded in 1996 operating in the Las Vegas metropolitan area.On September 5, 2006, Silver State Bancorp, the bank's holding company, acquired Choice Bank in the Phoenix/Scottsdale region of Arizona, and merged operations in 2008.
Failure
On September 5, 2008, the bank was closed by the Nevada Financial Institutions Division and placed under Federal Deposit Insurance CorporationFederal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...
(FDIC) receivership. Nonbrokered FDIC-insured accounts in Nevada were transferred to Nevada State Bank, while those in Arizona were transferred to National Bank of Arizona, both of which are operating subsidiaries of Zions Bancorporation. The bank was the 11th insured commercial bank to fail in 2008, compared to three in all of 2007. An estimated $450 to $550 million in losses are expected to be covered by the FDIC Deposit Insurance Fund. Some customers who did not understand FDIC insurance limits sustained losses of deposits they believed safe. Uninsured deposited amounted to $20 million in 500 accounts.
The underlying cause of failure was overexposure to risky real estate loans, especially mortgages on undeveloped land purchased for home construction that was no longer viable following the collapse of the housing bubble
United States housing bubble
The United States housing bubble is an economic bubble affecting many parts of the United States housing market in over half of American states. Housing prices peaked in early 2006, started to decline in 2006 and 2007, and may not yet have hit bottom as of 2011. On December 30, 2008 the...
.
Andrew McCain
The Wall Street Journal reported that Andrew McCain, son of Republican presidential candidate John McCainJohn McCain
John Sidney McCain III is the senior United States Senator from Arizona. He was the Republican nominee for president in the 2008 United States election....
, sat on the board of Silver State Bank for five months in 2008, resigning on July 26 for "personal reasons," shortly before he would have had to sign off on second-quarter audit statements.
External links
- Silver State Bank homepage
- vs credit card