Nov. 3 Update: Fifth Third Bank Acquires Freedom Bank of FLFreedom Bank of Bradenton, FL., was closed on Friday by state banking officials, thus becoming the 17th U.S. bank to fail so far this year.
Freedom Bank's deposits were assumed by Fifth Third Bank after the Federal Deposit Insurance Corp. (FDIC) was named receiver. The bank had total assets of $287 million and deposits of $254 million. In addition, Fifth Third will buy $36 million of the bank's assets. The cost to the FDIC insurance fund will be between $80 million to $104 million.
Fifth Third Bancorp is a diversified financial services company headquartered in Cincinnati, Ohio. As of September 30, 2008, the Company has $116 billion in assets, operates 18 affiliates with 1,298 full-service Banking Centers. Fifth Third operates five main businesses: Commercial Banking, Branch Banking, Consumer Lending, Investment Advisors and Fifth Third Processing Solutions. Fifth Third is among the largest money managers in the Midwest and, as of September 30, 2008, has $196 billion in assets under care. Fifth Third's common stock is traded on the NASDAQÂ® National Global Select Market under the symbol "FITB."
Global News Points to Recession
In many ways, the news about Freedom Bank is a sign of unsettled economic times. Around the globe, economists report economic growth slowing to a virtual standstill. The European Commission is calling for coordinated action after saying the 15-nation euro zone was in a technical recession. Last week's reports showed the U.S. economy contracted as well, with a shrinkage of 0.3 percent annual rate in the third quarter -- its biggest dip in more than 6 years.
Markets Open on Positive Note
In trading, the European stock markets rose slightly ahead of an expected uneventful opening on Wall Street. Investors are awaiting several economic reports on manufacturing, construction spending and auto sales, as well as the outcome of Tuesday's presidential elections.
No Bailout for GM
In other news, the U.S. Treasury Department turned down a request by General Motors for up to $10 billion to help the automaker finance a possible merger deal with Chrysler. Treasury officials are said to be hesitant to broaden the $700 billion bank bailout to include industrial companies or manufacturers such as GM or Chrysler. The Bush administration will instead speed to approval a $25 billion loan program for fuel-efficient vehicles that will be overseen by the Energy Department.
Auto sales are at their lowest level in 15 years, and the Big Three auto makers are working to remain solvent and dodge bankruptcy.