Home Federal Savings Bank third to fail in Michigan this year

Brian J. O'Connor / Detroit News Finance Editor

Bank regulators seized and sold Detroit's Home Federal Savings Bank on Friday night, arranging for Liberty Bank and Trust Co. of New Orleans to assume all of the deposits.

Home Federal had two branches, and both will reopen during their normal business hours as branches of Liberty Bank and Trust. An announcement from the FDIC said Home Federal depositors can access their money Friday evening and over the weekend by writing checks. Checks drawn on the bank will continue to be processed, regulators said, and loan customers should continue to make their payments as usual. Home Federal didn't maintain ATMs or issue debit cards, an FDIC spokesman said.

The thrift opened in 1947 as Detroit's first black-owned banking institution in Detroit, but had fallen on hard times and earlier this year had been ordered to find a buyer by April 15, according to a report in Crain's Detroit Business.

The most recent safety ratings from BauerFinancial gave Home Federal a "zero stars" rating and noted that the bank had lost $211,000 by the end of June, after losing more than half a million dollars in 2008. Total assets of the bank were $14.9 million as of Sept. 24; total deposits were about $12.8 million at that time, the spokesman said.

Home Federal is the third Michigan bank to be seized and sold this year -- Warren Bank was sold in October and Michigan Heritage Bank in April, according to FDIC records.

boconnor@detnews.com 313-222-2145