August 22, 2009
Guaranty Bank seized, sold to foreign firm
Troubled Texas lender Guaranty Bank has been sold to a Spanish bank after the U.S. government agreed to absorb about $3 billion of its losses, officials say.
Under the deal, announced Friday by the Federal Deposit Insurance Corp., regulators took over the bank, based in Austin, Texas, then brokered its sale to the American subsidiary of Banco Bilbao Vizcaya Argentaria in one of the largest-ever government-assisted deals with a foreign firm, The New York Times reported.
The newspaper said that under the deal, BBVA has agreed to buy $12 billion of the $13 billion assets remaining at Guaranty Bank, which it will then attempt to sell to private investors.
The Times said analysts view the BBVA deal as a signal the FDIC has become more willing to consider bids from foreign banks for failing institutions.