QUESTIONS have gone unanswered around a recent scam that led to a bank failure.
Still, Kansas banking officials reassured depositors that all banks remain "strong and healthy" after Heartland Tri-State Bank's recent failure.
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Bank officials said a recently closed bank was "the victim of a huge scam," leading to its failure.
Officials said they do not know what kind of scam caused the bank to fail.
"It was a terribly unfortunate event, but the system did work, and people had no interruption in accessing their accounts," David Herndon, Kansas' bank commissioner said to Hays Post.
"Sometimes businesses fail. This time it was a bank. But the depositors were protected."
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Heartland Bank's CEO didn't immediately respond to The U.S. Sun's request for comment.
"Kansas banks are strong and healthy," Herndon added.
"They are well-capitalized, have strong reserves, are profitable and maintain record levels of loan reserves."
INSIDE THE KANSAS CLOSURE
No Heartland depositors lost their money in the bank failure.
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The Kansas bank commissioner declared Heartland insolvent and appointed the Federal Deposit Insurance Corporation (FDIC) as the receiver on July 28.
"Heartland Tri-State Bank became insolvent due to an isolated event," the statement said at the time, ensuring depositors at other Kansas banks that their money was not impacted by the failure.
"Overall, the Kansas banking industry is unaffected by this event and Kansas banks remain strong."
The FDIC then transferred the deposits to another local bank, Dream First Bank.
Dream First agreed to purchase "essentially all of the failed bank’s assets" and reopened all four Heartland Tri-State branches.
All Heartland depositors can access money by writing checks, using ATMs, or using debit cards.
"Checks drawn on the bank will continue to be processed," the Kansas bank commission wrote in a statement.
"Loan customers should continue to make their payments as usual."
The bank's closure was the fourth bank shuttering this year in the US - the other three banks were much larger than the local Kansas bank.
FOUR BANK CLOSURES IN 2023
Heartland is the first bank to fail since First Republic in early May.
The Kansas bank had $139million worth of assets and $130million in total deposits during its closure, according to the FDIC.
Heartland's assets were approximately one-tenth of one percent of the assets of the three other bank failures.
First Republic had $229billion in assets; Signature Bank had $110billion; and Silicon Valley Bank had $209billion.
First Republic was the second-largest bank collapse in American history.
Herndon said Heartland's closure "had nothing to do" with the other three collapses, according to Yahoo Finance.
The FDIC insures deposits up to $250,000 in the event of a bank failure.
In the three larger bank failures, the FDIC insured all deposits, regardless of the amount.
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The U.S. Sun reports on other bank updates - here is a bank that is closing several small branches.
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