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Bank whose investors include ex-Ald. Beavers closed by regulators

Updated: March 10, 2012 12:21AM

State and federal regulators Friday closed New City Bank, a small single-branch operation with a big political backer, Cook County Commissioner William Beavers (D-Chicago).

Beavers, who was indicted on federal tax charges last month, was an investor and vice chairman of the bank at 900 S. Michigan. Beavers, a former city alderman, did not respond to a request for comment Friday evening.

The Federal Deposit Insurance Corp. said it approved payouts of insured deposits at the bank of up to a maximum of $250,000 per account.

The FDIC said it could not find a buyer to assume New City operations, so it will mail checks directly to depositors. The agency said depositors with questions can call (800) 523-8173.

The shutdown will cost the FDIC’s insurance fund about $17.4 million, the agency said. As of Dec. 31, New City reported $71.2 million in assets and $72.4 million in deposits. It is the 13th FDIC-insured bank to fail this year nationwide.

The bank’s most recent listing of its officers on its web site omitted any mention of Beavers, who is accused of failing to pay taxes on more than $226,000 in campaign funds he allegedly converted to personal use.

The last Chicago-area bank that regulators closed was Charter National Bank and Trust in Hoffman Estates on Feb. 10.

The FDIC said it will hold all assets of New City for later distribution and that customers should make loan payments as usual.

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