Chicago's Metropolitan Capital Bank Fails, Marking Second Consecutive Year of Early U.S. Banking Collapse
CHICAGO — In a troubling repeat of recent history, a Chicago bank has once again become the first U.S. banking casualty of the year. State regulators closed Metropolitan Capital Bank & Trust on Friday, pointing to "unsafe and unsound conditions and an impaired capital position." The move underscores lingering vulnerabilities within certain segments of the regional banking sector.
The Illinois Department of Financial and Professional Regulation (IDFPR) took control of the River North-based institution, which specialized in serving small and midsize businesses. The Federal Deposit Insurance Corporation (FDIC), appointed as receiver, immediately orchestrated a purchase agreement with Detroit-based First Independence Bank. By Monday, the branches had reopened under the new owner's banner.
"We want to be clear that no depositor will lose any money as a result of this action," stated Susana Soriano, acting director of IDFPR's Division of Banking. The FDIC confirmed that First Independence Bank has assumed substantially all of Metropolitan's $212 million in deposits and purchased $251 million of its $261 million in assets.
The collapse is expected to cost the FDIC's Deposit Insurance Fund an estimated $19.7 million. Founded in 2005, Metropolitan Capital billed itself as North America's only boutique "Universal Bank" for entrepreneurs, offering a integrated suite of commercial, private, and investment banking services.
Its acquirer, First Independence Bank, is a Michigan state-chartered commercial bank founded in 1970 with a mission to serve underserved and minority communities in Detroit. It is the only African American-owned bank headquartered in the state.
This failure echoes the pattern from just a year prior. In January 2025, Chicago's Pulaski Savings Bank became the nation's first bank failure, later followed by The Santa Anna National Bank in Texas. Before 2025, Chicago had enjoyed nearly a decade without a bank collapse, a streak broken in 2017 by two high-profile failures linked to fraud and scandal.
Analyst & Public Reaction:
"This is a sobering but contained event," said Michael Thorne, a banking analyst at Great Lakes Financial Advisors. "The system worked as designed—no depositor losses, a quick acquisition. It highlights, however, the persistent pressure on smaller banks navigating a high-interest-rate environment and commercial real estate headwinds."
Lisa Rodriguez, a small business owner who banked with Metropolitan for eight years, expressed relief. "It was unsettling over the weekend, but the transition was seamless. My accounts were accessible Monday morning. I'm hopeful First Independence will maintain the personalized service we relied on."
Others were more critical. David Kline, a former bank examiner and now a vocal critic on financial stability, offered a sharper take: "This isn't a coincidence; it's a symptom. Two years in a row, Chicago kicks off the national failure list. It suggests regulatory oversight might be missing the forest for the trees, or worse, acting only when it's too late. What about the 'unsound conditions' before Friday? Were red flags ignored? Main Street businesses bear the brunt of this instability."
The FDIC will retain the remaining assets of Metropolitan Capital for later disposition, with the final cost to its fund to be determined.