Scottsdale Based Bank shut down by FEDS

The Federal Deposit Insurance Corp (FDIC) shut down Arizona's largest Arizona's based bank.

Based out of Scottsdale, First National Bank (the slef-described" home of the Alt-A mortgage", which was a specialist in lower quality mortgages.

First National Bank of Arizona, Scottsdale, Arizona, merged with First National Bank of Nevada and is included in this action.

The combined entity was taken over by Mutual of Omaha.

A link from the First AZ web site immedietly forwards to the Mutual of Omaha site which reads like a tombstone :

On July 25, 2008, First National Bank of Nevada, Reno, Nevada was closed by the Office of the Comptroller of the Currency (OCC). Subsequently the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

Experts have claimed that more bank failures are imminent before we see any recovery in financials and thus lending and finally real estate.

Discussion : Question of the day,

• do most of you use major national banks like Bank America, Chase Bank, Wells Fargo ??
• as they are (for now) the most financialy sound?
• or do you use smaller regional banks?
• are you concerned about your deposits?

I have been curious why someone would take the risk to use local small banks for small percentage higher returns on deposits??