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FDIC Dissolving Bank that Was Financing the Stalled
 Landmark Hotel, Charlottesville, Virginia

By Brian McNeill, The Daily Progress, Charlottesville, Va.McClatchy-Tribune Regional News

Jun. 6, 2009--The Federal Deposit Insurance Corp. announced Friday that it is dissolving the bank financing the stalled Landmark Hotel project on the Downtown Mall.

The FDIC seized Atlanta-based Silverton Bank on May 1 with the goal of finding a company to take it over. A month later, no qualified buyers had stepped forward. As a result, the government is preparing to shutter the bank and will offer the institution's parts up for sale.

"On May 1st, the Office of the Comptroller of the Currency closed Silverton and the FDIC was appointed receiver," said Andrew Gray, director of the FDIC office of public affairs, in a statement. "Since that time, the FDIC has been running the institution as a bridge bank. The FDIC's marketing efforts pre resolution did not result in any interest for acquiring Silverton. However, prior to FDIC's appointment as receiver, Silverton had initiated a marketing effort, which was allowed to continue until a whole bank acquisition was no longer feasible.

"The FDIC will begin an orderly wind-down of Silverton Bridge Bank, N.A., and begin to offer the institution in its component parts," Gray continued. "We will ensure that sufficient time is given to smoothly transition correspondent banking services to other providers."

Construction of the half-finished Landmark Hotel, a nine-story, 100-room luxury hotel, has been halted for months. The hotel's owner, Halsey Minor, did not immediately return a call for comment Friday.

It was not yet known how Silverton Bank's failure would affect the Landmark Hotel project.

Last fall, Minor blamed the project's problems on Silverton Bank's financial troubles, alleging that a bank subsidiary, Specialty Finance Group, had failed to deliver on loan payments.

Minor and Silverton Bank have filed lawsuits against each other in connection with the project.

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Copyright (c) 2009, The Daily Progress, Charlottesville, Va.

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