BFF=Bank Failure Friday 2010

[Zippyjuan]

Back during the S&L crisis, as many as 500 banks were closed in just one year (1989 with 534). The most in one week was 60- the week of April 20th 1989. There were eleven consecutive years of at least 100 S&Ls closed (starting 1982). Compared to then, this is not a lot yet. Most of the closed banks are merged with or sold to other institutions so little money is actually lost. During the Great Depression in 1933 alone, 4000 banks closed their doors. When banks closed during the depression, share holders and depositors lost everything. That 1933 number was the last year before the FDIC- closures dropped dramatically the following year to less than 20. There was never 100 closures in a year again until 1982.

This crisis is still continuing so we don't know yet if it will be as bad as the S&L crisis or not. The 500 closures occured during the seventh year of the S&L crisis and we are not at that point in time yet on this one.

http://www.calculatedriskblog.com/2009/07/fdic-bank-failures-update.html


Yes, I know that Sarge and Hollowood and other regular visitors to this thread have already seen this information. This is for libertybrewcity and other new visitors who may stop by.

 

[HOLLYWOOD]

How many times do I have to post this...

It's not the amount of banks that fail, but the loses from debt and payouts from the seizures. What should also be included are FDIC mandated fees up front as well as all new legislation by Washington DC in new Fees, Charges, and Taxes

The current amount of assets at troubled banks is well over $400 billion but since the FDIC doesn’t list all troubled banks it's much larger.

The amount of debt/loses is currently estimated @ $620 BILLION

As far as the S&L crisis... the taxpayers are still paying for the loses. $3.3 Billion charge on the US Treasury sheets, each year for 50 years.

 

[Sarge]

It is that time again.

With banks still to be closed, and a new banking crisis on the way, it is going to get interesting where the next big amount of money is going to come from when it happens.

I will not even get into banks putting back on their books what they fraudulently hid. Oh, wait, it was just an oversight.

 

[Merk]

From Survivalblog.com today.

"Letter Re: The ABA's Projections for the U.S. Economy
Permalink
Jim:
Greetings and my Compliments. I have just returned from a training meeting my employer, USDA-Rural Development. It was presented by the American Bankers Association. Bottom line, the ABA is projecting the economy not to bottom out until late in 2014. With over 90 banks already closed (in 2010) and some 775 on the the "Troubled" list, things do not look good. The troubled list has a projected 70 percent failure rate."

 

[Sarge]

MerK,

Thank you for that one. Now the truth is starting to get out.

 

[Cap]

From Survivalblog.com today.

"Letter Re: The ABA's Projections for the U.S. Economy
Permalink
Jim:
Greetings and my Compliments. I have just returned from a training meeting my employer, USDA-Rural Development. It was presented by the American Bankers Association. Bottom line, the ABA is projecting the economy not to bottom out until late in 2014. With over 90 banks already closed (in 2010) and some 775 on the the "Troubled" list, things do not look good. The troubled list has a projected 70 percent failure rate."

Wow. Rather sobering.

 

[Zippyjuan]

Bottom line, the ABA is projecting the economy not to bottom out until late in 2014.

Hmm. Really? The ABA recently forecast growth over the next two years. That does not sound like they say the economy won't bottom out until 2014. This is from June 16th of this year. They also forecast a decline (though slow) in unemployment over the next two years.
http://www.marketwatch.com/story/fed-on-hold-until-mid-2011-bank-analysts-say-2010-06-16

The ABA panel sees an economy that is growing at "half-speed" for the next year-and-a-half, Hoffman said.

Still, a double-dip recession is very unlikely, the panel said.

Instead, the economy will muddle through with a total of 2.2 million new jobs created in 2010 and another 2.5 million in 2011. This is only a faction of the 8.5 million jobs lost in the recession. The unemployment rate will drop slowly to 8.5% at the end of next year.

With income growth from the job creation boosting consumer income and spending, real gross domestic product should grow at just over a 3% annual pace through 2011, the panel said.

The bank economists were sensitive to charges that banks are not lending enough credit to sustain the recovery.

"Bank lending is growing and will help finance the economic expansion," Hoffman said.

It was best to view bank credit as a bathtub, he said. By the end of the year, more new lending will flow into the tub than is going down the drain from charge-offs, so the level of loans outstanding should increase, Hoffman said.

The level of bank credit will be enough to finance growth at a moderate 3.0-3.5% rate, Hoffman said.

 

[Sarge]

You might want to read this,

http://www.businessinsider.com/weekly-leading-index-almost-a-lock-for-double-dip-territory-2010-7

Ben, is even now admitting things are not going to get better for years.

If you buy the article you posted, watch and learn. Look at the consumer confidence index tanking today. Down almost 9 points.

 

[Sarge]

First bank for today,

http://www.fdic.gov/bank/individual/failed/banklist.html

91 and moving on up to the East Side.

 

[ghengis86]

make that 6 so far

http://www.fdic.gov/bank/individual/failed/banklist.html

 

[devil21]

Hmm. Really? The ABA recently forecast growth over the next two years. That does not sound like they say the economy won't bottom out until 2014. This is from June 16th of this year. They also forecast a decline (though slow) in unemployment over the next two years.
http://www.marketwatch.com/story/fed-on-hold-until-mid-2011-bank-analysts-say-2010-06-16

The ABA wouldn't dare publish conflicting forecasts depending on who the audience of the forecast is! Right? What you're quoting is an article suited for mainstream consumption (MSM news website) while the other source is more for insider consumption (in person seminar/conference).

As we see often, those two things tend to not be compatible.

 

[Zippyjuan]

I don't see the actual report where they said no upturn until 2014- just hearsay that they made that comment. Unless you do have a link- I would like to take a look at it and see just exactly what they did say. Thank you. I would also be interested in info on the projected 70% failure rate for the list of troubled banks.

http://www.calculatedriskblog.com/2010/04/unofficial-problem-bank-list-at-682.html

We have updated the transition matrix for the first appearance of the Unofficial Problem Bank List on August 7, 2009. (see below) Back then, the list had 389 institutions with assets of $276.3 billion. Subsequently, 296 institutions or 76 percent still remain open with an outstanding formal enforcement action.

Approximately 24 percent or 93 institutions have been removed from the initial list. The majority of the removals have occurred through failure (70 institutions or 75 percent of removals). Other removals are for action termination or a return to healthy status (16 institutions or 17 percent of removals) and unassisted mergers (7 institutions or 7.5 percent of removals).

So far, the failure rate for institutions on the initial list is approximately 18 percent (70 institutions/389 institutions). This failure rate is higher than the historical 13 percent rate mentioned by the FDIC and frequently cited by the media (see links):

We have long suspected that the often cited historical failure rate of 13 percent for institutions on the problem bank list was a bit misleading for the current crisis because it is most likely derived from a long time series that includes non-crisis periods. Thus, the FDIC historical metric cannot be used to estimate how many institutions on the problem bank list during this crisis will fail. Already, the failure rate is 18 percent, which is five percentage points above the historical rate. Moreover, it can only go higher for institutions on the initial list. Therefore, anyone that continues to cite this statistic, especially to downplay the magnitude of having 700 institutions on the official list, is badly misinformed.

Interestingly, in an interview with Time Magazine, FDIC Chairman Shelia Bair is now citing a higher failure rate of 23 percent for institutions on the problem bank list. In addition, Chairman Bair sounds more sanguine on the outlook for failures and predicts they peak in 2010 at a rate not much higher than 2009. See comments from a Time Magazine interview published April 9, 2010: FDIC's Sheila Bair on Bank Failures and Too-Big-To-Fail
Time: We saw 140 bank failures in 2009; another 41 so far this year. Is the worst behind us?

Bair: I think we'll go above the 2009 level, but that bank failures will peak this year. The institutions by asset size might be a little smaller, but there will be more of them. But it's important that people understand that the number of bank failures is still a very small percentage of the overall number of insured institutions in the country — and obviously their insured deposits are protected.

Time: How many banks are on your watch list right now?

Bair: There are about 700 right now, but most of these banks will not fail. Historically, about 23% of banks that go on the list actually fail. One of the reasons we put them on the troubled bank list is so that they can get some extra supervisory attention and...get nursed back to health.

The economy does not move linearly so I would expect things to move up and down. I also think that it will be quite a while before we get back to where they were before the crisis started- and by that I do mean several years. Maybe they meant that things would be more solidly growing by 2014. It is already off its lows meaning that it did turn a corner already.

 

[DamianTV]

Hmm...

 

[Sarge]

Here it is Friday again. I wonder if they will close 4 to make it 100 today?

 

[SevenEyedJeff]

5 so far:

Community Security Bank New Prague MN 34486 July 23, 2010 July 23, 2010
Thunder Bank Sylvan Grove KS 10506 July 23, 2010 July 23, 2010
Williamsburg First National Bank Kingstree SC 17837 July 23, 2010 July 23, 2010
Crescent Bank and Trust Company Jasper GA 27559 July 23, 2010 July 23, 2010
Sterling Bank Lantana FL 32536 July 23, 2010 July 23, 2010

 

[Sarge]

101 and moving on up.

Thank you for the update.

 

[cindy25]

one more: SouthwestUSA in LV, NV

 

[HOLLYWOOD]

one more: SouthwestUSA in LV, NV

http://www.fid.state.nv.us/

http://news.medill.northwestern.edu/chicago/news.aspx?id=164855&print=1

Wall Street / Federal Bailout of Il, ShoreBank leads to suspicion on Capitol Hill
by Frank Kalman

It appears Obama/Valeri Jarrett/Rahm Emanuel and a slew of other Chicago cronies' bank, SHOREBANK, continues to survive from FDIC seizure through Wall Street returning the bailout favors of the FEDS to help their hometown bank from collapse and seizure. So far a total of $200 Million ($130 Million form Wall st and $75 Million in TARP)

Last week, FOX Business analyst, Charlie Gasparino has stated the bank will need an additional $150-$250 Million to, pardon the pun, Shore-Up against Debt and Loses to avoid FDIC seizure/closure.

The Federal government is completely; colluding, racketeering, and corrupt. RICO laws apply to them more than the mafia now.

 

[cindy25]

and another:
Home Valley Bank, Cave Junction, OR

 

[puppetmaster]

consolidation efforts are working well.