Colonial Bank, incorporated as Colonial BancGroup (NYSE: CNB) was a Montgomery-based regional bank with 300 branches in Alabama, Georgia, Florida, Nevada and Texas.
The bank was founded as the City National Bank of Birmingham in 1965 and was taken over in 1981 by Bobby Lowder, who renamed it. It acquired the Exchange National Bank of Birmingham in 1982. In its prime, Colonial was one of the nation's largest backers of mortgage originators. It constructed a new Birmingham headquarters, the Colonial Bank Building, on the site of the former Shades Valley High School, in 2001.
The bank failed in 2009, going into the receivership of the Federal Deposit Insurance Corporation on August 14. The bank was the largest to fail in 2009, during the "great recession". Winston-Salem, North Carolina-based BB&T acquired $22 billion of Colonial's $25 billion in assets, including all of its branches, with the remainder liquidated by the FDIC.
Its exposure to more than $1.9 million in delinquent loans, primarily in the Florida market, triggered its failure. A planned injection of capital from its primary lendee, Taylor Bean & Whitaker, which would have given the Florida-based lender 75% ownership of Colonial, fell through following a federal fraud investigation. Taylor Bean was blocked from making FHA-backed loans, resulting in a shutdown of the company. Later that week a federal judge ordered the freezing of $1 billion of Colonial's assets pending the outcome of a lawsuit brought by Bank of America.
Chairman & CEO Lowder retired in May 2009, immediately prior to the planned deal. Lewis Beville took over as CEO and Simuel Sippial Jr became chairman of the board.
Colonial had 26 offices in the metropolitan Birmingham area:
- Empire Building (formerly called the City National Bank Building), 1928 1st Avenue North, Downtown Birmingham
- 820 19th Street South, Medical Center
- 1900 29th Avenue South, Homewood
- 1596 Montgomery Highway, Hoover
- 1034 Montgomery Highway, Vestavia Hills
- 1500 Montclair Road, Eastwood
- 1602 Forestdale Plaza, Forestdale
- 27 Park Road, Pleasant Grove
- 2705 Meadowbrook Road, Inverness
- 629 Red Lane Road, Roebuck
- 2750 John Hawkins Parkway, Hoover
- 200 18th Street North, Bessemer
- 1325 Decatur Highway, Gardendale
- 2998 Pelham Parkway, Pelham
- 5580 Chalkville Mountain Road, Grayson Valley
- 2821 Moody Parkway, Moody
- 14487 U. S. Highway 411, Odenville
- 5836 U. S. Highway 11, Springville
- 2203 1st Avenue North, Pell City
- 3901 U. S. Highway 78 East, Jasper
- 2002 2nd Avenue, Jasper
- 415 2nd Avenue East, Oneonta
- 255 5th Street, Ashville
- Colonial Bank (October 5, 2006) Wikipedia - accessed October 6, 2006
- Jarvis, Crystal (June 3, 2009) "Colonial BancGroup names new execs to replace Lowder." Birmingham Business Journal
- Jarvis, Crystal (August 14, 2009) "It's official: Colonial BancGroup fails." Birmingham Business Journal
- Thornton, William (January 2, 2018) "Federal judge finds negligence in 2009 Colonial Bank collapse." The Birmingham News