A Missouri-based bank, which The Phoenix Cos. agreed to purchase earlier this year to qualify for federal bailout money, has been taken over by federal regulators, forcing the Hartford insurer to reassess its eligibility for the Treasury’s capital purchase program.
American Sterling Bank, a $184 million-asset lender based in Sugar Creek, Mo., was closed Friday by the Office of Thrift Supervision, and the Federal Deposit Insurance Corp. was appointed as its receiver. The FDIC also entered into a purchase and assumption agreement with Metcalf Bank, another Missouri-based bank, to assume all $172 million in deposits of American Sterling.
Earlier this year, the Office of Thrift Supervision approved a nonbinding agreement for Phoenix Cos. to acquire American Sterling as part of Phoenix’s attempt to become a thrift holding company. By doing so the Phoenix would become eligible to apply for millions of dollars in TARP aid.
“We are considering our options in light of this latest development,” Phoenix spokeswoman Alice S. Ericson said today.
The Phoenix, which said it will cut hundreds of jobs and whose former CEO, Dona Young, retired last week, has been struggling with investment losses, ratings downgrades and an ailing variable annuity business.
