Second Bank in Seven Days Fails in Orange County

South Coast Bank of Costa Mesa, its capital depleted by mounting loan losses and operational costs, was closed Friday by the state Banking Department--the second Orange County bank failure in seven days and the fourth in California this year.

The Federal Deposit Insurance Corp. immediately was named receiver of the bank and announced late Friday evening that Harbor Bank of Long Beach had successfully bid to assume the deposits and offices of South Coast. Harbor is scheduled to reopen the failed bank’s Costa Mesa and Fountain Valley branches Monday morning under its own name.

A state banking official said the closure, coming just one week after the failure of Capistrano National Bank of Santa Ana, marked the first time in California’s post-Depression history that two banks have collapsed in such a short period.