Bank Failure in Chicago Marks First of 2026

On Friday, state regulators closed Metropolitan Capital Bank & Trust, marking the first bank closure in the U.S. for 2026 and the second in Chicago in recent years.

The Illinois Department of Financial and Professional Regulation took action due to concerns over the bank’s financial stability.

The Federal Deposit Insurance Corporation (FDIC) has been appointed as the receiver and facilitated the sale of most of the bank’s $261 million in assets, including all deposits, to First Independence Bank based in Detroit. Customers will continue to have immediate access to their funds, though payments on loans will still be required.

“We want to assure everyone that no depositor will experience a loss because of this decision,” stated Susana Soriano, who is acting director of the IDFPR’s banking division.

Regarding the bank’s conditions, Soriano mentioned its “unsafe and unsound practices and declining capital base,” but emphasized that First Independence Bank is “well positioned to maintain essential banking services” for those affected.

Metropolitan Capital, which opened its doors in 2005, served clients across 46 states and 10 countries. Its physical locations included an office at 9 E. Ontario Street and another in New York. Attempts to contact co-founder and president Frank Novell for comment were unsuccessful.

According to reports, the bank had total assets of $261.1 million and deposits amounting to $212.1 million as of September 30. The closure is projected to cost the Deposit Insurance Fund around $19.7 million, according to the FDIC.

This marks the first bank failure in the United States this year. In the previous year, only two banks failed, one of which was Chicago’s Pulaski Savings Bank.

This incident follows one of the city’s most infamous bank failures, the Washington Federal Savings Bank, which suffered a $140 million embezzlement scheme in 2017 resulting in multiple federal indictments and a four-month prison sentence for the former 11th Ward Alderman, Patrick Daley Thompson.

Since 2000, Illinois has seen 71 bank failures, with 22 occurring in Chicago alone.

Metropolitan Capital’s River North branch will reopen as a First Independence Bank branch during regular business hours on February 2. For further inquiries, customers are directed to call (866) 314-1744.