Chicago’s Metropolitan Capital Bank Becomes First U.S. Bank Failure of 2026
February 2, 2026 – Chicago, IL – For the second consecutive year, a Chicago-based bank has become the first in the nation to fail. Metropolitan Capital Bank & Trust, a universal bank specializing in serving small- to medium-sized businesses, was shut down Friday by the Illinois Department of Financial and Professional Regulation (IDFPR).
Authorities cited “unsafe and unsound conditions and an impaired capital position” as reasons for the closure. The Federal Deposit Insurance Corporation (FDIC) was named receiver and promptly arranged for Detroit-based First Independence Bank to take over the operations and reopen the institution under a new name this Monday.
Customer Deposits Fully Protected
In a joint statement, IDFPR’s acting director of the Division of Banking, Susana Soriano, assured customers, “We want to be clear that no depositor will lose any money as a result of this action.” Metropolitan Capital Bank & Trust held approximately $261 million in assets and $212 million in total deposits at the time of closure.
As part of the agreement, First Independence Bank assumed “substantially all deposits” and purchased $251 million of Metropolitan’s assets. The FDIC will retain some assets for future disposition. The agency estimates that the bank’s failure will eventually cost its Deposit Insurance Fund about $19.7 million, though this figure may fluctuate as assets are liquidated.
Background on Metropolitan Capital Bank
Located at 9 East Ontario Street in Chicago’s River North neighborhood, Metropolitan Capital Bank & Trust opened in 2005. The bank was originally founded as a universal bank designed to provide a comprehensive range of financial services—including commercial, private, and investment banking—all through a single platform. Metropolitan proudly advertised itself as North America’s only boutique universal bank focused on supporting small- to medium-sized businesses and their founders.
First Independence Bank Steps In
First Independence Bank, headquartered in Detroit, was founded in 1970 with a mission to serve underserved and minority communities by providing crucial financial services. It remains the only African American-owned bank based in Michigan. Soriano expressed confidence in First Independence Bank’s ability to maintain essential banking services for former Metropolitan customers.
Attempts to reach representatives of First Independence Bank for comment on Monday were unsuccessful.
Chicago’s Recent History of Bank Failures
Chicago has now experienced two years in a row with the dubious distinction of hosting the nation’s first bank failure. In January 2025, Pulaski Savings Bank was shut by the IDFPR, with its assets and deposits assumed by Millennium Bank of Des Plaines. Another bank, Santa Anna National Bank in Texas, failed mid-2025. Before this recent string, Chicago went nearly a decade without a bank failure. However, the city saw notable closures in 2017, including the demise of Seaway Bank and Trust and Washington Federal Bank for Savings. The latter’s closure was connected to a $31 million embezzlement scandal involving high-level bank officials and former Chicago Alderman Patrick Daley Thompson.
Looking Ahead
The Metropolitan Capital Bank closure serves as a reminder of ongoing challenges within the banking sector, particularly among smaller, regional institutions that cater to niche markets. Regulators have responded swiftly to protect depositors and preserve financial stability.
For now, former Metropolitan customers can expect uninterrupted service under the new ownership of First Independence Bank, as the industry watches closely for any further ripple effects from the bank’s failure.
Reported by Robert Channick, Chicago Tribune
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