Bank Abruptly Shut Down by US Regulator in Fourth Bank Failure of 2026

US regulators have abruptly shut down a bank in Kansas in the fourth bank failure of 2026.

The Federal Deposit Insurance Corporation (FDIC) says the Kansas Office of the State Bank Commissioner has closed Small Business Bank.

The FDIC has been appointed as the receiver and has entered into a purchase and assumption agreement with The Farmers State Bank of Oakley, Kansas, which will assume substantially all deposits and purchase certain assets.

“Small Business Bank’s sole branch will reopen as a branch of Farmers State Bank during its normal business hours on Monday, July 20, 2026.

Depositors of Small Business Bank will automatically become depositors of Farmers State Bank. The deposits assumed by Farmers State Bank will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship.”

The FDIC has not stated why the bank failed.

Small Business Bank is based in Lenexa, holding about $73 million in assets and approximately $69 million in deposits as of March 31, 2026.

Preliminary estimates show the failure will cost the agency’s Deposit Insurance Fund (DIF) about $5.7 million. The estimate will likely change over time as retained assets are sold.

The other three bank failures of this year are Metropolitan Capital Bank & Trust in Illinois, Community Bank and Trust in West Georgia and Kentland Federal Savings and Loan Association in Indiana.

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