US Regulators Shut Down Illinois Bank in First Failure of 2026

Metropolitan Capital Bank & Trust closed by state regulators, assets assumed by First Independence Bank

Jan. 31, 2026 at 2:31am

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The Federal Deposit Insurance Corporation (FDIC) announced that the Illinois Department of Financial and Professional Regulation has closed Metropolitan Capital Bank & Trust, a bank based in Chicago with around $260 million in assets. The FDIC has been appointed as the receiver and has entered into an agreement with First Independence Bank to assume substantially all of Metropolitan Capital Bank & Trust's deposits.

Why it matters

Bank failures are rare events, with the last major wave occurring during the 2008 financial crisis. This is the first bank failure of 2026, signaling potential stress in the banking sector that regulators will need to monitor closely to prevent broader contagion.

The details

According to the FDIC, Metropolitan Capital Bank & Trust's sole office will reopen as a branch of First Independence Bank on Monday, February 2, 2026. Depositors of Metropolitan Capital Bank & Trust will automatically become depositors of First Independence Bank, with their deposits continuing to be insured by the FDIC. The FDIC has not stated the specific reasons for the bank's failure, but preliminary estimates show the failure will cost the agency's Deposit Insurance Fund about $19.7 million.

  • Metropolitan Capital Bank & Trust was closed by Illinois regulators on January 31, 2026.
  • The bank's sole office will reopen as a branch of First Independence Bank on February 2, 2026.

The players

Federal Deposit Insurance Corporation (FDIC)

The independent agency of the United States government that insures deposits in banks and provides other banking-related services.

Illinois Department of Financial and Professional Regulation (IDFPR)

The state agency responsible for regulating and supervising financial institutions in Illinois.

First Independence Bank

The bank that has assumed substantially all of Metropolitan Capital Bank & Trust's deposits.

Metropolitan Capital Bank & Trust

The Illinois-based bank that was closed by state regulators, with approximately $260 million in assets.

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What’s next

The FDIC will continue to monitor the banking sector for any signs of further stress or potential failures, and will work to ensure a smooth transition for Metropolitan Capital Bank & Trust's customers.

The takeaway

This bank failure serves as a reminder of the importance of strong regulatory oversight and the FDIC's role in protecting depositors and maintaining stability in the banking system, even during times of economic uncertainty.