Developer Shaya Boymelgreen

The New York State Department of Banking shut down developer Shaya Boymelgreen’s struggling LibertyPointe Bank, and the Federal Deposit Insurance Corporation sold its assets to Wayne, N.J.-based Valley National Bank, marking the first New York state bank seizure this year. The shut down — which will cost the FDIC $24.8 million — comes nine months after federal and state regulators issued a cease and desist order against the lender for using unsound banking practices, including operating with an excessive amount of commercial real estate loans. “It is a top priority of the New York State Banking Department to
protect the deposits of consumers of New York State banks and ensure
the safety and soundness of the banking system in the state,” said
Richard Nieman, state superintendent of banks, in a statement. Valley National Bank officials said the bank assumed about $200 million
in deposits and received about $180 million in loans, which are subject
to a loss-share agreement with the FDIC. The bank also received $20
million in cash and other assets. [more]