In five U.S. states, banking regulators closed 5 banks downed by record numbers of defaults and foreclosures, increasing the number of failed federally insured banks this year to 69.

Mutual Bank, the biggest of the shuttered banks, with $1.6 billion total deposits and $1.6 billion in total assets, was shut down by the banking division of the Illinois Department of Financial Professional Regulation.

The banking division made FDIC as receiver and approved the assumption of deposits and assets of the failed bank by Texas-based United Central Bank of Garland. The FDIC signed a loss-sharing deal with First United Central Bank covering Mutual Bank’s $1.3 billion assets. The 12 branches of the failed bank will reopen as units of United Central Bank.

First State Bank of Altus, which had $98.2 million in total deposits and $103.4 million in total assets, was shut down by the Oklahoma State Banking Department and will be taken over by Herring Bank of Amarillo, Texas. Herring will acquire the failed bank’s deposits and around $64.4 million of its assets. The remaining assets will be acquired by the FDIC, which was appointed as receiver, for subsequent sale. First State’s branches will reopen as units of Herring Bank.

FDIC closed Integrity Bank in Jupiter, Florida and approved the assumption of the failed bank’s deposits and around $52 million of assets by Fort Lauderdale-based Stonegate Bank.

Integrity had $102 million in total deposits and $119 million in total assets. The FDIC will sell the remaining assets.
Another bank closed by FDIC was First BankAmericano in Elizabeth, New Jersey, which had $157 million in total deposits and $166 million in total assets. Another New Jersey bank, Crown Bank, will assume the First BankAmericano’s deposits and assets, including its six branches.

Peoples Community Bank of West Chester, Ohio will be taken over by Hamilton-based First National Bank, which will acquire $657.8 million of the failed bank’s assets in an agreement with the FDIC. Peoples had $598.2 million in total assets and $705.8 million in total deposits, including 19 branches.

The total of 69 bank failures so far this year represents big jumps from the 25 failures last year and the 3 failures in 2007.

According to analysts, residential loan defaults and foreclosures have been the main causes of the failures. Although residential foreclosures are slowing down, regional banks are expected to suffer from commercial real estate defaults. The FDIC expects to spend around $70 billion to cover bank failures through 2013.