Douglass National Bank fails
By MARK DAVIS
The Kansas City Star

Douglass National Bank’s failure is the first in the Kansas City area since Superior National Bank failed in April 1994.

Douglass National Bank, the Kansas City area’s only black-owned bank, failed Friday under the weight of mounting loan problems. It will reopen Monday as part of a Louisiana bank.

The bank’s failure is the first in the nation this year and the first in the area since Superior National Bank failed in April 1994.

Douglass’ two Kansas City, Kan., offices and one in Kansas City will reopen as branches of Liberty Bank and Trust Co. of New Orleans.

Liberty is a profitable $327 million bank with 14 branches in Louisiana, Mississippi and Texas.

The Web site for Liberty said that it was founded in 1972 and that it is one of the five largest African-American-owned banks nationally.

Douglass has struggled with mounting loan problems and operated under March 2006 orders from regulators to improve its dwindling capital strength.

In the last two years, losses had reached $5.6 million, and more than 20 percent of the bank’s remaining loans were still considered problems as of the end of December.

Douglass officials did not respond to inquiries Friday afternoon.

The Office of the Comptroller of the Currency, which regulates nationally chartered banks, closed Douglass after its regular business hours Friday and appointed the Federal Deposit Insurance Corp. to be receiver. The FDIC said it sold $55.7 million of Douglass’ assets to Liberty Bank and Trust at book value, less a discount of $6.1 million.

Depositors’ accounts transferred automatically to Liberty Bank and Trust. The FDIC said customers could access their money this weekend by writing checks and using debit or automated teller cards.

Customers can seek additional information by calling 888-206-4662 or visiting www.fdic.gov/bank/individual/failed/douglas.html.

“Liberty’s a good bank,â€