Irwin Union Bank, F.S.B., Louisville, Kentucky

Irwin Union Bank, F.S.B., Louisville, Kentucky, has closed its doors by order of the FDIC, making it number 94 this year.

First Financial Bank, National Association, Hamilton, Ohio, got a mouthful tonight when it is assumed all deposits of both Irwin Union Bank, F.S.B., Louisville, Kentucky and Irwin Union Bank and Trust Company, Columbus, Indiana. The  two failures are the first in Kentucky for the year and brings the number of FDIC closures for 2009 up to 94. The agency estimates they hit to its Deposit Insurance Fund (DIF)will be about $850 million for both institutions.

Federal and state regulators today closed Irwin Union Bank, F.S.B., Louisville, Kentucky, and Irwin Union Bank and Trust Company, Columbus, Indiana, respectively. The institutions are banking subsidiaries of Irwin Financial Corporation, Columbus, Indiana. The regulators immediately named the Federal Deposit Insurance Corporation (FDIC) as the receiver for the banks. To protect depositors, the FDIC entered into a purchase and assumption agreement with First Financial Bank, National Association, Hamilton, Ohio, to assume all of the deposits of the two banks.

Irwin Union Bank and Trust Company, Columbus, Indiana, was closed by the Indiana Department of Financial Institutions. As of August 31, 2009, it had total assets of $2.7 billion and total deposits of approximately $2.1 billion. Irwin Union Bank, F.S.B., Louisville, Kentucky, was closed by the Office of Thrift Supervision. As of August 31, 2009, it had total assets of $493 million and total deposits of approximately $441 million.

Irwin Union B&T Company and Irwin Union Bank, F.S.B. had 27 locations between them and will reopen during their normal business hours beginning Saturday as branches of First Financial Bank. Depositors of the failed institutions will automatically become depositors of First Financial Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. All customers should continue to use their existing branches until First Financial Bank can fully integrate the deposit records of the two institutions.

This evening and over the weekend, depositors of Irwin Union B&T Company and Irwin Union Bank, F.S.B. can access their money by writing checks or using ATM or debit cards. Checks drawn on the institutions will continue to be processed. Loan customers should continue to make their payments as usual.

First Financial Bank will pay the FDIC a premium of one percent to assume all of the deposits of Irwin Union B&T Company and zero percent for those of Irwin Union Bank, F.S.B. In addition to assuming all of the deposits of the failed institutions, First Financial Bank agreed to purchase essentially all of their assets.

The FDIC and First Financial Bank entered into a loss-share transaction on approximately $2.5 billion of the assets of Irwin Union B&T Company and Irwin Union Bank, F.S.B. First Financial Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers.

For more information on loss-share transactions, please visit the FDIC webpage for Irwin Union Bank, F.S.B.

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