Regulators close Colorado Capital Bank

Regulators Friday announced the closure of Colorado Capital Bank, with its assets and deposits purchased by First-Citizens Bank & Trust Co. of Raleigh, North Carolina.

The Colorado Division of Banking closed the Castle Rock-based institution, with the Federal Deposit Insurance Corp. appointed as receiver. The FDIC entered into a purchase and assumption agreement with First-Citizens, which assumed substantially all of the assets and deposits of Colorado Capital, which operated a branch in Boulder at 1434 Spruce St.

That branch and six others will reopen Monday as branches of First-Citizens, with depositors automatically becoming depositors of First-Citizens.

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“Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits,” the FDIC said in a statement. “Customers of Colorado Capital Bank should continue to use their existing branch until they receive notice from First-Citizens Bank & Trust Company that it has completed systems changes to allow other First-Citizens Bank & Trust Company branches to process their accounts as well.”

Colorado Capital Bank reported total assets of $717.5 million and total deposits of $672.8 million, as of March 31.

The FDIC and First-Citizens Bank & Trust Company entered into a loss-share transaction on $580 million of Colorado Capital Bank’s assets. First-Citizens will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector, the FDIC said.

The failure is expected to cost the FDIC’s Deposit Insurance Fund $283.8 million. Colorado Capital Bank is the 50th FDIC-insured institution to fail in the nation this year, and the third in Colorado. The last FDIC-insured institution closed in the state was Louisville-based FirsTier Bank, closed on Jan. 28, 2011.

First-Citizens previously acquired the assets of United Western Bank of Denver.