FBOP Corp. bought by U.S. Bancorp

CHICAGO, Oct. 31 (UPI) -- The Chicago area's third-largest locally based bank holding company was seized by federal regulators and purchased by Minnesota-based U.S. Bancorp.

Oak Park-based FBOP Corp. was shut down Friday by the Federal Deposit Insurance Corp., after failing in the wake of the federal government's seizure more than a year ago of mortgage giants Fannie Mae and Freddie Mac, Crain's Chicago Business reported.

At the time, FBOP had seen more than $800 million of the preferred stock it held in Fannie and Freddie wiped out.

With the acquisition of the failed bank, U.S. Bank becomes the 11th-largest bank in the Chicago area, growing from 57 to 87 branches and increasing its deposits from $2.4 billion to $5.8 billion, Crain's reported.

FBOP locations, among them Park National Bank's 30 branches, were to open Saturday as U.S. Bank branches.

Michael Kelly, chief executive officer of FBOP, notified bank executives in an internal memo late Friday of the bank's closing, a source told Crain's.

Kelly, 64, had started the bank company in 1981 with the acquisition of First Bank of Oak Park and expanded during the savings and loan crisis of the late 1980s and early 1990s, buying branches, assets and deposits of troubled banks.