Officials not surprised by closure: New owners reassure Ogle County that deposits are secure

Rock River Bank in Oregon was one of six that failed in Illinois last week. All have reopened under new ownership. (Earleen Hinton/ehinton@shawnews.com)

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OREGON – The closing of Rock River Bank a week ago didn’t come as a surprise to local government officials.

“We’ve been kind of aware for a month or more,” Ogle County Board Chairman Ed Rice said. “We’ve been watching it.”

The bank was closed by the Federal Deposit Insurance Corp. on Thursday, when it was taken over by The Harvard State Bank.

Video: Government closes Rock River Bank.

The county had $4 million in accounts at Rock River Bank, which was one of several local banks where county funds are deposited.

“I have been in contact with the bank over the last several months, since their last quarterly numbers came out, to be sure our money was secure,” Ogle County Treasurer John Coffman said Tuesday.

He became concerned when the bank’s equity dropped significantly from the previous quarter’s numbers. Coffman met with officials from The Harvard State Bank on Monday to discuss the situation, and after that, he met with Rice.

“We’ve been assured by The Harvard State Bank that the county has no concerns,” Rice said.

Oregon School Board President Tom Peters said Friday that school officials became aware of the bank’s difficulties a few months ago when interest rates on deposits there began to tumble.

The school district had $1.5 million at Rock River Bank, including its payroll account, he said.

“We had started moving money to another bank,” Peters said. “We had looked at other options because of the district’s reserves and the state of the economy.”

Like the county, the school district keeps its funds deposited in several local banks.

Peters said FDIC officials assured him that the district’s money is safe.

“Obviously, I’m concerned about the school district’s money, and yet I have to believe it’s business as usual,” he said. “The information I have is that our money should be safe with The Harvard State Bank.”

Oregon City Commissioner Ken Williams said the city had less than $250,000 deposited at Rock River Bank.

He voiced confidence in The Harvard State Bank.

“I don’t foresee any changes,” he said. "I expect a smooth transition with the new bank."