Bank-Liquidation Payout Approved
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An Orange County judge has approved a $70.05-million payout as the first distribution of proceeds from the liquidation of defunct Valencia Bank.
As previously reported, the payment amounts to 75% of the $93.4 million claimed by depositors and creditors of the Santa Ana bank, which regulators seized in February, 1986.
The Federal Deposit Insurance Corp., which insures deposits up to $100,000 per account, received the entire amount as Valencia’s largest creditor. The agency has already paid off more than $90 million to depositors.
The FDIC is retaining an additional $8.1 million as a reserve against expenses and litigation and is holding other liquidated assets appraised at $20 million.
FDIC officials expect at least two more distributions, which could result in repayment of all claims, including $2.1 million in uninsured deposits. They are not yet certain whether any money will be left for the bank’s shareholders.
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