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Corus Bank assets auctioned off by the FDIC

Corus Bank, which was closed down by regulators last month, has had its assets auctioned off by the Federal Deposit Insurance Corporation (FDIC) for $554 million.

The assets have been bought by the Northwest Investments consortium, which includes Starwood Capital Group and TPG, the private equity firm.

It paid around 60 cents to the dollar for a 40 per cent equity stake in a portfolio made up of unpaid loans and assets worth around $4.5 billion.

Northwest Investment won the auction ahead of seven other bidders and the deal is expected to go through by the middle of October 2009.

The remaining 60 per stake in the assets will continue to be held by the FDIC for the time being.

MB Financial had already agreed to buy $7 billion worth of Corus Bank's deposits.

Ninety-eight banks have already failed this year in the wake of the credit crisis and growing losses on commercial real estate.

By Asim Shah