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OCC Closes City National Bank Due to "Substantial Dissipation of Assets/Unsound Practices"

By rlsmetro on

WASHINGTON — City National Bank of New Jersey (“City National”) in Newark was closed on Friday by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as the receiver.

FDIC officials say to protect depositors, the FDIC entered into a purchase and assumption agreement with Industrial Bank in Washington, D.C., to assume all of the deposits of City National.

The three branches of City National will reopen as branches of Industrial Bank during regular business hours. Depositors of City National will automatically become depositors of Industrial Bank.

Because deposits will continue to be insured by the FDIC up to applicable limits, customers do not need to change their banking relationship in order to retain their deposit insurance coverage.

Cit National Bank was one of the few minority-owned banks in the country. Officials say Industrial, which is also a minority depository institution, agreed to buy all of City National's assets essentially and assume all of the failed bank’s deposits.

Customers of City National should continue to use their existing branch until they receive notice from Industrial Bank that it has completed systems changes to allow other Industrial Bank branches to process their accounts as well.

This evening and over the weekend, depositors of City National can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of September 30, 2019, City National had approximately $120.6 million in total assets and $111.2 million in total deposits. In addition to assuming all of the deposits of the failed bank, Industrial Bank agreed to purchase all of its assets essentially.

**The bank had five branches in Newark-Paterson-NYC:**

Main Office 900 Broad Street Newark, NJ

Newark South Side Branch 1080 Bergen Street Newark, NJ

Paterson Branch 125 Broadway Paterson, NJ

East New York Branch 2815 Atlantic Avenue New York, NY

West Harlem Branch 382 West 125 Street New York, NY

The last bank failure was Resolute Bank in Maumee, Ohio, on October 25. The last FDIC-insured institution closed in New Jersey was Harvest Community Bank in Pennsville, which closed on January 13, 2017.

The overall health of the banking system today remains strong, as reported in the FDIC's most recent Quarterly Banking Profile. On average, there are five bank failures each year in non-crisis times, according to FDIC data. There have been only three years since 1933 without a single bank failure.

Customers with questions about the transaction should call the FDIC toll-free at 1-877-367-2719. The phone number will be operational this evening until 9:00 p.m., Eastern Time (ET); on Saturday from 9:00 a.m. to 6:00 p.m., EST; on Sunday from noon to 6:00 p.m., ET; on Monday from 8:00 a.m. to 8:00 p.m., EST; and thereafter from 9:00 a.m. to 5:00 p.m., EST. Interested parties also can visit the FDIC's website at