NEW YORK (CNNMoney.com) -- Federal regulators closed Florida's First Priority Bank on Friday, marking the eighth bank failure of the year.
The Federal Deposit Insurance Corp., which was named the receiver of the failed bank, entered into an agreement with Atlanta-based SunTrust Bank (STI, Fortune 500) to assume the insured deposits of First Priority.
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Friday is "Bank Seizure Day." Almost all these failed institutions are closed on Friday afternoon and reopen on Monday under the name of the institution that has assumed the "assets." That is the case here.
All six branches of the Bradenton, Fla.-based bank will reopen on Monday as branches of SunTrust. First Priority depositors will automatically become depositors of SunTrust, the FDIC said.
Now we get to the nitty gritty: the uninsured deposits.
First Priority had assets of $259 million and total deposits of $227 million, according to the FDIC. That includes $13 million in uninsured deposits held in approximately 840 accounts that potentially exceeded the federal insurance limits.
FDIC insurance only goes so far. If you go over the $100,000 limit you are really out of luck.
Account holders with more than the $100,000 insured limit will essentially "become a creditor" of the failed bank, said FDIC spokesman Andrew Gray.
Those accounts will be credited as the FDIC sells more of the failed bank's assets, Gray said.
When my father died in 2000, he left my mother a sum of money. She was advised to put it into go-go internet stocks. I suggested she put it in savings. She took my advice.
The next day we went to four different banks, and set up four savings accounts, each one well under the $100,000 insured limit. There were two reasons. The first was mine, never deposit more than the insured amount because if the bank fails, you will get pennies on the dollar for the uninsured deposits. The second was my Democrat mother's (she cried when Humphrey lost to Nixon). Mom lived through the Great Depression and told me many times, "Never put all your money into one bank."
There are many troubled financial institutions in this nation. Even if you can't read a bank balance sheet you can keep your deposits under $100,000. Be safe, not sorry.