You are browsing the archives of 2009 October.

Banking Failures Hit 115 For 2009

The last week of October went out with a bang as regulators closed the largest number of banks in one week for 2009.  All nine failed banks were subsidiaries of FBOP Corporation of Oak Park, Illinois.   FBOP was not closed and not subject to the actions taken today by regulators.
U.S. [...]

Banking Failures - 106 And Counting
Banking regulators have been closing banks at a leisurely pace over the past two weeks despite the fact that many analysts expect upwards of 1,000 additional banks to fail based on their poor financial condition and mounting loan losses.  The FDIC Problem Bank List currently includes 416 banks with total [...]

FDIC Ends TLGP But Leaves Door Open For “Emergency Financing”
The FDIC issued a final ruling to phase out the Temporary Loan Guarantee Program (TLGP) by October 31, 2009.  In order to conclude the TLGP  in an orderly manner, however, the FDIC established a “limited emergency guarantee facility” for institutions that might be unable to refinance [...]

Banking Failures - 99 And Counting
The number of failed banks for 2009 has risen to 99. San Joaquin Bank of Bakersfield, California was closed by the California Department of Financial Institutions on Friday. The FDIC as receiver, entered into a purchase and assumption agreement with Citizens Business Bank or Ontario, California.
San Joaquin Bank, as of [...]

Does the recent strong rally in the shares of bank stocks imply that the banking crisis is over, or are we looking at a mirage?  Here are 7 reasons why the banking crisis may only be in the early stages of an ongoing crisis which could ultimately result in a lack of public confidence in [...]

The attitude of banks towards the collapse of commercial real estate seems to be ” ignore it and it will go away”.   Sometimes this strategy works, sometimes it doesn’t.
Right now, this “see no problem” attitude is beginning to raise eyebrows as  losses on commercial real estate loans expand while corresponding loss reserves decline.  Consider Fed [...]

In remarks to the International Institute of Finance, FDIC Chairman Sheila Bair cited the need for critical financial reforms that combine stronger regulation and market discipline.   Ms. Bair stated that the “first task” should be to scrap the “too big to fail” doctrine by establishing a new resolution mechanism to handle the failure of large [...]

Banking Failures - 98 And Counting
2009 has now seen a total of 73 more failed banks than occurred for all of 2008.  The latest banking closures bring total banking failures for 2009 to 98.  The latest three failed bank on October 2, 2009 had total assets of $634 million and total losses to the FDIC [...]

The International Monetary Fund’s latest Global Financial Stability Report (GFSR) predicts additional trillions of dollars in bank losses and warns that there is still a significant risk of another economic downturn.  In addition, massive public deficits may crowd out private borrowers, increasing the difficulty of financial institutions to raise needed capital.
José Viňals, Director of the [...]

No End In Sight To Debt Defaults
The extent of the continued severe deterioration in loan credit quality was revealed in the Shared National Credits Review, issued jointly by the Federal Reserve, FDIC, Office of the Comptroller of the Currency and the Office of Thrift Supervision.
Credit quality declined sharply
The credit risk of these large [...]