U.S. regulators seize a bank to bankers

Silverton had about 1,400 client banks in 44 states and provided services that included credit card operations, clearing accounts and trading of loans, including the real estate loans that were its undoing.

The Federal Deposit Insurance Corp said it had created a bridge bank to take over Silverton, saying this would allow its client banks to maintain their relationship with the least amount of disruption.

"This is not going to change the financial make-up of any of the institutions doing business" with Silverton, said Mitchell Glassman, who heads the FDIC's resolutions and receiverships division.

Silverton, with about $4.1 billion in assets and $3.3 billion deposits, was the largest failure since Downey Savings and Loan was seized in November with about $12.8 billion in assets.

The FDIC said the failure is expected to cost its deposit insurance fund about $1.3 billion.