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Irwin Financial files for bankruptcy liquidation

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Columbus-based Irwin Financial Corp. has filed for Chapter 7 bankruptcy, setting the stage for the liquidation of the remaining assets of the troubled banking company.

The bankruptcy petition, signed by Irwin CFO Gregory F. Ehlinger, lists between 200 and 999 creditors. It estimates Irwin’s assets between $10 million and $50 million, and its liabilities between $100 million and $500 million. Details about Irwin’s individual creditors and the amounts they’re owed were not disclosed.

On Friday, regulators seized and shut down Irwin’s two banking units: Irwin Union Bank and Trust, which had $2.7 billion and assets and $2.1 billion in deposits; and thrift Irwin Bank FSB, which had $493 million in assets and $441 million in deposits.

Irwin is represented in its filing by three Barnes and Thornburg attorneys: David M. Powlen, Mark J. Adey and Sarah Quinn Kuhny. Three attorneys from the firm Rubin and Levin—Elliott D. Levin, James T. Young and John C. Hoard—are named as trustees.

The Federal Deposit Insurance Corp. arranged Irwin's sale to Hamilton, Ohio-based First Financial Bank. First Financial already had bought Irwin's Carmel, Greensburg and Shelbyville bank branches in August. The purchase included Irwin's 27 remaining branches, 12 of which are in Indiana.

The collapse of Irwin's two units marks the 93rd and 94th failures this year of U.S. federally insured banks. The FDIC took on Irwin's riskiest assets and expects to book an $850 million charge to its insurance fund in connection to the failure.

Irwin Financial had been in financial decline for more than a year, in part because of steep losses on home equity loans. Over the last six quarters, Irwin posted losses totaling more than $450 million. Founded in 1871, it was one of the state's oldest banks.

 

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  1. I took Bruce's comments to highlight a glaring issue when it comes to a state's image, and therefore its overall branding. An example is Michigan vs. Indiana. Michigan has done an excellent job of following through on its branding strategy around "Pure Michigan", even down to the detail of the rest stops. Since a state's branding is often targeted to visitors, it makes sense that rest stops, being that point of first impression, should be significant. It is clear that Indiana doesn't care as much about the impression it gives visitors even though our branding as the Crossroads of America does place importance on travel. Bruce's point is quite logical and accurate.

  2. I appreciated the article. I guess I have become so accustomed to making my "pit stops" at places where I can ALSO get gasoline and something hot to eat, that I hardly even notice public rest stops anymore. That said, I do concur with the rationale that our rest stops (if we are to have them at all) can and should be both fiscally-responsible AND designed to make a positive impression about our state.

  3. I don't know about the rest of you but I only stop at these places for one reason, and it's not to picnic. I move trucks for dealers and have been to rest areas in most all 48 lower states. Some of ours need upgrading no doubt. Many states rest areas are much worse than ours. In the rest area on I-70 just past Richmond truckers have to hike about a quarter of a mile. When I stop I;m generally in a bit of a hurry. Convenience,not beauty, is a primary concern.

  4. Community Hospital is the only system to not have layoffs? That is not true. Because I was one of the people who was laid off from East. And all of the LPN's have been laid off. Just because their layoffs were not announced or done all together does not mean people did not lose their jobs. They cherry-picked people from departments one by one. But you add them all up and it's several hundred. And East has had a dramatic drop I in patient beds from 800 to around 125. I know because I worked there for 30 years.

  5. I have obtained my 6 gallon badge for my donation of A Positive blood. I'm sorry to hear that my donation was nothing but a profit center for the Indiana Blood Center.

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