Synovus, the second-largest banking company based in Georgia, acquired three branches of a Valdosta-based bank that failed Friday. It was the state’s third bank failure this year.
Sunrise Bank, which had branches in Valdosta, Atlanta and outside Macon, was told by federal regulators in January 2012 that it had to raise new funds from investors, merge with another bank or accept an offer to be acquired.
It had been in trouble for several years and was significantly undercapitalized. In 2010, the former Sunrise Bank of Atlanta merged with related banks in Jeffersonville and Valdosta in a bid to shore up their collective balance sheets. Capitol Bancorp, a Michigan bank holding company that held interests in the three banks, was ordered to sell its investments. It has since filed for bankruptcy.
Last year, Sunrise Bank acting President and CEO Richard Cathy said he was “very optimistic” that the bank would raise the needed capital to stay open.
The branches will reopen Monday as branches of Columbus-headquartered Synovus Bank. The Atlanta branch will be part of Bank of North Georgia, Jeffersonville will open as CB&T of Middle Georgia, and Valdosta will open as First State Bank and Trust Co.
At the end of March, Sunrise Bank had $60.8 million in total assets and $57.8 million in total deposits, according to the Federal Deposit Insurance Corp. Synovus will assume all the deposits of Sunrise Bank, and $13.2 million of Sunrise’s assets.
This is the second time Synovus or one of its chartered banks has bought a failed bank since the beginning of the crisis. In 2009, Bank of North Georgia acquired the failed American Southern Bank of Kennesaw.
That was Georgia’s fifth bank failure. The state now leads the nation with 87 bank failures since mid-2008. Prior to Friday’s failure, the most recent was Douglas County Bank in Douglasville on April 26.