Regulators have shut down Colonial BancGroup Inc., a big lender in real estate development that buckled under the collapse of the market. It was the biggest U.S. bank to fail this year, with about $25 billion in assets.
The Federal Deposit Insurance Corp. was appointed receiver of Montgomery, Ala.-based Colonial. The agency approved the sale of Colonial's $20 billion in deposits and about $22 billion of its assets to BB&T Corp. The failed bank's 346 branches in Alabama, Florida, Georgia, Nevada and Texas will reopen at the normal times starting on Saturday as offices of BB&T, the FDIC said.
The failure of Colonial is expected to cost the deposit insurance fund an estimated $2.8 billion.