Bank failure: Kansas Heartland Tri-State Bank closed by FDIC

Heartland Tri-State Bank, based in Elkhart, Kansas, has failed, leading to the Federal Deposit Insurance Corporation (FDIC) stepping in to protect customer deposits. As part of this process, the FDIC has entered a purchase and assumption agreement with Dream First Bank of Syracuse, Kansas, and will assume all the deposits of Heartland Tri-State Bank.

Following the agreement, the four branches of Heartland Tri-State Bank will reopen as branches of Dream First Bank on Monday. This move comes after recent bank closures, including First Republic, Silicon Valley Bank, and Signature Bank, which have raised concerns in the banking industry, prompting lawmakers to introduce new legislation aimed at safeguarding customer deposits and stabilizing the financial system.

Heartland Tri-State Bank’s failure marks the first bank collapse since the early May demise of First Republic, which was the second-largest bank failure in the nation’s history.

The FDIC reassured bank customers that they can access their money through various means, including writing checks or using ATM and debit cards. Additionally, they won’t need to switch banks, as they will automatically become customers of Dream First Bank.

With approximately $139 million in total assets and $130 million in total deposits, Heartland Tri-State Bank’s failure prompted Dream First Bank to agree to purchase “essentially all” of the failed bank’s assets.

Regarding loan customers, the FDIC assured them that they should not be significantly affected by the bank’s failure. The FDIC and Dream First Bank have established an agreement to share losses and potential recoveries on the loans. Thus, loan customers are advised to continue making payments as usual, with no changes expected to the terms of their loans.