Federal regulators seize AmTrust Bank

The West Delray branch of AmTrust Bank at West Atlantic Avenue and Hagen Ranch Road.

By David Sedore, Palm Beach Business.com

DELRAY BEACH — The federal Office of Thrift Supervision seized Cleveland-based AmTrust Bank late Friday, a victim of the real estate meltdown in Florida, Arizona and Ohio,  and sold the 66-branch thrift to New York Community Bank.

In a statement, the Federal Deposit Insurance Corp. said all bank branches continue to operate normally, as will all electronic banking services and ATMs. An AmTrust branch west of Delray Beach appeared operating normally Saturday, with customers making transactions using the ATM.

While the AmTrust website had notice of the transaction, there wasn't so much as a hint of the deal was posted at the branch.

AmTrust had 66 offices, including two in Delray Beach, two in Boynton Beach and one in Boca Raton. Altogether, the Bank has 24 offices in Florida, 22 of which are in Palm Beach, Broward and Miami-Dade counties.

New York Community Bank is based in Westbury, N.Y.; it has $42 billion in assets. It had 177 offices in New York and New Jersey before taking over AmTrust. This is the first venture outside of New York and New Jersey for the 150-year-old bank.

AmTrust had $12 billion in assets and $8 billion in deposits. According to the FDIC, the seizure will cost the government agency.

Although customers had no notice of the takeover, the seizure was not entirely a surprise. AmTrust’s bank holding company filed for bankruptcy in Cleveland earlier in the week. The company listed $169.5 billion in debt and $100 million in assets.

"In the past two years, the debtors have diligently attempted to survive the downturn in the economy," AmTrust Chief Executive Officer Peter Goldberg said in court papers. "Deterioration in mortgage quality and availability slowed the pace of transactions and devalued homes."