The Park Avenue Bank, New York, New York, was closed Friday by the New York State Banking Department.

The Federal Deposit Insurance Corporation (FDIC) was appointed as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Valley National Bank, Wayne, New Jersey, to assume all of the deposits of The Park Avenue Bank.

The four branches of The Park Avenue Bank, including its headquarters at 460 Park Avenue, and at Borough Park, Bay Ridge, Manhattan, and Midwood will reopen during normal business hours beginning Saturday as branches of Valley National Bank. Depositors of The Park Avenue Bank will automatically become depositors of Valley National Bank, the FDIC said in a statement released Friday evening. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branch until they receive notice from Valley National Bank that it has completed systems changes to allow other Valley National Bank branches to process their accounts as well, the FDIC statement said.

Over the weekend, depositors of The Park Avenue Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of December 31, 2009, The Park Avenue Bank had approximately $520.1 million in total assets and $494.5 million in total deposits. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $50.7 million.