Failed Bank Information

Information for Bank of the Eastern Shore, Cambridge, MD

1. Introduction
2. Press Release
3. Is My Account Fully Insured?
4. National Deposit Institution (NDI)
5. Question and Answer Guide
6. Banking Services
7. Loan Customers
8. Possible Claims Against the Failed Institution
9. Priority of Claims
10. Dividend Information
11. Brokered Deposits
12. Purchase and Assumption Agreement with Deposit Insurance National Bank of Eastern Shore (DINB) (2.3 mb PDF File - PDF Help)
13. Eastern Shore Contact Information
14. Balance Sheet Summary

I.  Introduction

On Friday, April 27, 2012, Bank of the Eastern Shore, Cambridge, MD was closed by the Maryland Commissioner of Financial Regulation, and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

The FDIC has assembled useful information regarding your relationship with this institution. Besides a checking account, you may have Certificates of Deposit, a car loan, a business checking account, a commercial loan, a Social Security direct deposit, and other relationships with the institution. The FDIC has compiled the following information, which should answer many of your questions.

II.  Press Release

The FDIC has issued a press release (PR-046-2012) about the institution's closure. If you represent a media outlet and would like information about the closure, please contact LaJuan Williams-Young at 1-202-898-3876.

III.  Is My Account Fully Insured?

This link will allow you to verify the insurance status of each of your accounts. This link will be available for use no later than the first business day after bank failure.

Simply enter your account number in the search screen. If you receive the message that "your account is fully insured" a link will appear that provides you with additional information. If you receive the message that you should contact the FDIC, then a link will appear that provides your contact information.

Is My Account Fully Insured?

IV.  National Deposit Institution (NDI)

To protect the depositors, the FDIC created the Deposit Insurance National Bank of Eastern Shore (DINB), which will remain open until May 25, 2012 to allow depositors access to their insured deposits and time to open accounts at other insured institutions. 

At the time of closing, the receiver immediately transferred to the DINB all insured deposits of Bank of the Eastern Shore, except for brokered deposits, certificates of deposits (CDs) and individual retirement accounts (IRAs). The receiver also transferred to the DINB all secured deposits by public entities. The FDIC will mail checks directly to customers with CDs and IRAs. 

Principal and interest on insured accounts, through Friday, April 27, 2012, are fully insured by the FDIC, up to the insurance limit of $250,000. You will receive full payment for your insured account. Certain entitlements and different types of accounts can be insured for more than the $250,000 limit. IRA funds are insured separately from other types of accounts, up to a $250,000 limit.

All interest bearing accounts that exceed the $250,000 insurance limit and/or all interest bearing accounts that appear to be related and exceed this limit are reviewed by the FDIC to determine their ownership and insurance coverage. If you think you might have uninsured deposits, you should call the FDIC Call Center to arrange for a telephone interview with a Claims Agent at 1-800-591-2817. The Claim Agent may direct you to download and submit a particular form that will assist in expediting the processing of your claim.

List of Affidavits, Declarations, and Forms available for download

Please return the forms to the FDIC by FAX (facsimile) or mail at the number or address listed for the failed institution.

If it is determined that you have uninsured funds, the FDIC will generate and mail to you a Receiver Certificate. This certificate entitles you to share proportionately in any funds recovered through the disposal of the assets of Bank of the Eastern Shore. This means that you may eventually recover some of your uninsured funds.

To find out more about FDIC Deposit Insurance:

• Visit EDIE the FDIC's Electronic Deposit Insurance Estimator
• View the FDIC Deposit Insurance Coverage Video

Your CD(s) will automatically be closed, and you will receive a check up to the insured amount from the FDIC. You will not be assessed an early withdrawal penalty. A hold may be in place on deposit accounts due to delinquent loans where the depositor is the borrower or guarantor. Additionally, any account pledged as collateral for a loan will be held.

V.  Banking Services

You can continue to use your personal checks; however, they must clear by Friday, May 25, 2012, or they will be returned unpaid. You can continue to make deposits until Friday, May 18, 2012. You can use ATM/Debit cards until Monday, May 14, 2012. Online banking and bill pay services will be suspended through the weekend and be available Monday, April 30, 2012. Online banking services will no longer be available after May 14, 2012. Branches will remain open until Friday, May 25, 2012.

Merchants are encouraged to honor Bank of the Eastern Shore checks, as these will continue to clear up to the insured available balance until Friday, May 25, 2012. A copy of this document or the press release from www.fdic.gov can be provided since both documents indicate that insured deposits have been received by DINB of Eastern Shore. Additional copies will be available at the bank. Depositors or merchants can also call the FDIC at 800-591-2817 or contact staff at your former Bank of the Eastern Shore branch locations to confirm this information.

Automatic direct deposit(s) will continue until close of business Friday, May 18, 2012.

VI.  Loan Customers

If you had a loan with Bank of the Eastern Shore, you should continue to make your payments as usual.  The terms of your loan will not change, because they are contractually agreed to in your promissory note. Checks should be made payable as usual and sent to the same address until further notice. If you have further questions regarding an existing loan, please contact your loan officer.

Please see A Borrower's Guide to an FDIC Insured Bank Failure for additional information.

VII.  Possible Claims Against the Failed Institution

Claims against failed financial institutions occur when bills sent to the institution remain unpaid at the time of failure. If you or your company provided a service or product, leased space, furniture, or equipment to Bank of the Eastern Shore after Friday, April 27, 2012 and have not been paid, you do not have a claim against Bank of the Eastern Shore. Please follow your normal billing procedures by providing an invoice as instructed.

If you or your company provided a service or product, leased space, furniture, or equipment to Bank of the Eastern Shore prior to Friday, April 27, 2012 and have not been paid, you may be entitled to a claim against the bank. If you provided a product to or a service for Bank of the Eastern Shore prior to the bank's failure for which you have not been paid and you have not received communication, please contact:

Please note: There are time limits for filing a claim, your claim must be filed on or before .

Shareholders have a claim against the receivership; however, they have the lowest priority of claim. You should discuss this with an accountant and/or the IRS concerning the exact requirements necessary to recognize the investment as a loss for tax purposes. The FDIC does not require stockholders to file a claim with the Receiver. However, we recommend that you keep our office informed of any address change, should we need to contact you in the future.

VIII.  Priority of Claims

In accordance with Federal law, allowed claims will be paid, after administrative expenses, in the following order of priority:

Depositors

General Unsecured Creditors

Subordinated Debt

Stockholders

IX.  Dividend Information

No dividends have been declared at this time.

Dividend Information on Failed Financial Institutions

X.  Brokered Deposits

The FDIC offers a reference guide to deposit brokers acting as agents for their investor clientele.  This site outlines the FDIC's policies and procedures that must be followed by deposit brokers when filing for pass-through insurance coverage on custodial accounts deposited in a failed FDIC Insured Institution.

Deposit Broker's Processing Guide