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Centrue, at around $1.2 billion in assets, is the second-largest bank on the Bartmann Bank Monitor Report list.

STREATOR — Centrue Bank's troubled real estate loan portfolio, battered by the recession, has helped earn it a spot on a debt advisory firm's new "10 Most Troubled Banks in Illinois" list.

Centrue, at around $1.2 billion in assets, is the second-largest bank on the Bartmann Bank Monitor Report list. Its parent company, Centrue Financial Corp., is based in St. Louis, but the bank’s main office and Illinois state charter are in Streator. Its two dozen Illinois locations include two in Streator and one in Dwight.

The bank, with around 300 full-time employees, traces its roots to 1874, when its charter was granted as Union National Bank of Streator, according to its website. A bank spokesperson could not be reached for comment Tuesday.

The banks on the Bartmann list share some common characteristics — undercapitalized with a high exposure to commercial real estate and development loans — publisher Bill Bartmann said Tuesday. The banks tend to carry large volumes of foreclosed real estate and a large number of loans that are behind in payments, the firm said.

Centrue has $792 million in total loans, including around $70.91 million in loans secured by real estate in which interest is overdue and repayment of the principal is at risk. That’s up from $4.58 million in nonaccrual real estate loans in 2007.

Centrue lost $38.1 million in 2009 and $10.2 million so far in 2010, as it sets aside more money to cover for troubled loans.

“With improving credit quality as our top priority, we continue to focus on aggressively managing and resolving our problem assets,” said Centrue president and CEO Thomas Daiber in a statement this month.

In December, Centrue signed an agreement with regulators, who told bank officials to strengthen their risk-management practices, come up with a plan to maintain sufficient capital and report back to the regulators regularly.

The Bank of Illinois in Normal and John Warner Bank in Clinton were among 21 Illinois banks to fail in 2009, and 140 nationwide. So far in 2010, at least 118 U.S. banks failed, including 15 in Illinois.

Bartmann said, generally speaking, many failed banks made loans to “Main Street businesses” that are now unable to pay them back due to the bad economy.

“Unfortunately, as these businesses become unable to repay their loans, they will fail, and so will the local banks,” Bartmann said in a statement.

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