277 banks will go bankrupt in 2010 in USA
By Shan SAEED—Economist
It’s so surprising and total contradiction that banks will continue to go down and US economy will recover. But the question is how? Recovery figures are questionable, economy looks weak and tax rates are improving up gradually [health care bill]. US banking system are following the Canadian banking model of consolidation. Few banks act like oligopoly, safe and peace of mind for clients.
Let me share some statistics
Year Banks went bust in USA
2010 277 [ Expected]
U.S. bank failures reached 103 so far in 2010 on Friday i.e. 23rd July 2010.as regulators seized seven small banks, a faster pace of closures than last year when the century mark was not reached until October.
Bank failures are expected to peak in the 3rd quarter-2010, with the industry slowly recovering from large portfolios of bad loans, many tied to commercial real estate, slow credit growth and fragile economy.
Banks that became history were Sterling Bank of Lantana, Florida; Crescent Bank and Trust Company of Jasper, Georgia; Williamsburg First National Bank of Kingstree, South Carolina; Thunder Bank of Sylvan Grove, Kansas; Community Security Bank of New Prague, Minnesota; SouthwestUSA Bank of Las Vegas, Nevada and Home Valley Bank of Cave Junction, Oregon, according to the Federal Deposit Insurance Corp.
The largest of the seven banks was Crescent Bank and Trust with 11 branches and about $1.01 billion in total assets and $965.7 million in total deposits. The smallest was Thunder Bank with just two branches and $32.6 million in total assets and $28.5 million in deposits.
The FDIC estimated the seven failures would add about $531 million to the tab for its deposit insurance fund.
Latest update on the overall health of the bank industry in USA according to the industry experts, saying they see little improvements in the economy and threat of sovereign debt on bonds are still lurking.
It clearly illustrates that clients whose individual accounts are insured up to $250,000, updated its estimates of the cost of bank failures, now expecting a $100 billion hit to its insurance fund from 2010 through 2014. The recovery of the community bank industry has lagged the bounce back of Wall Street and the healing in the overall economy.
These views and analyzes are done by Shan Saeed. Financial markets are changing every second. Clients and investors are advised to perform their own Due Diligence before investment. All investment related research /articles are based on the authors personal views…I strongly advise investors/people/ institutional clients/pensioners to follow their own investment strategy according your risk appetite and profile.