Saturday, May 29, 2010 | 2:05 a.m.
Sun Archives
Nine months after its Nevada and Arizona banks were closed by regulators, Community Bancorp filed for bankruptcy protection Friday.
The filing showed federal regulators are demanding some $805 million from the company because of alleged mismanagement of the banks.
In the Las Vegas bankruptcy court filing, Community Bancorp listed debt and liabilities of more than $880 million including demands of $805.5 million by the Federal Deposit Insurance Corp.
The Las Vegas company listed $43.7 million in assets and indicated unsecured creditors will recover nothing in the Chapter 7 liquidation.
The company’s main assets are $27.1 million in federal income tax refunds due because of net losses between 2004 and 2007; and $16.5 million for directors and officers insurance policies.
The main creditor is the FDIC, which has asserted a $780 million claim against subsidiary Community Bank of Nevada for civil damages and wrongful acts apparently tied to concerns that the bank failed because of unsound lending practices.
The FDIC made a similar demand, for $25.5 million, against subsidiary Community Bank of Arizona.
Both of the FDIC claims are listed as “disputed” by Community Bancorp.
Other big creditors are Merrill Lynch, as trustee for investors in trust securities owed $20 million; Wilmington Trust Co., another trustee for investors owed $50 million; and Pacific Coast Bankers Bank, owed $5.2 million.
On Aug. 14, regulators closed Community Bank of Nevada as well as Community
Bank of Arizona.
Community Bancorp had been hurt by the recession and its reliance on real estate loans — many financed with high-rate brokered deposits.
The FDIC said that as of June 30, 2009, Community Bank of Nevada had loans and other assets of $1.52 billion and deposits of about $1.38 billion.
Join the Discussion:
Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.
Full comments policy