Eighteen former Midwest Bank officers and directors will pay a total of $26.5 million to the Federal Deposit Insurance Corp. to settle a 2013 lawsuit alleging that their negligence in lending to risky borrowers contributed to losses at the failed institution.
Midwest Bank, based in Elmwood Park, was a $3.17 billion-asset lender that was among the first community banks to get federal bailout funds after the financial crisis erupted. It was part of Midwest Banc Holdings, which had been a publicly traded banking company, and was seized by regulators in 2010. It was among the largest local banks to fail after the financial crisis.
The FDIC occasionally sues executives of banks that collapse. The Midwest Bank lawsuit was filed in U.S. District Court in Chicago.