A Real Failure Friday: Five Banks Fail in Worst Week Since April 2011
The government said Wednesday it is starting to sell $2.2 billion in trust preferred shares that it holds in Citigroup, another move to recoup the costs incurred in the $700 billion financial bailout.
The Treasury Department said the pace of the sales would be determined by market conditions.
The government's list of troubled banks hit its highest level since 1992 during the second quarter, although the pace of growth continued to slow, according to a government report released Tuesday.
The number of banks at risk of failing rose by almost 7% to reach 829, the Federal Deposit Insurance Corporation said in its quarterly survey of the nation's banking system.
More than 700 banks, or nearly one out of every 11, are at risk of going under, according to a government report published Tuesday.
The Federal Deposit Insurance Corp. said that the number of banks on its so-called "problem list" climbed to 702, its highest level since June 1993.
Over the past year, several articles have appeared exactly like this one, and the math never seems to make sense. Does that imply that people are withholding information? Or are the numbers that large that a few billion here or there doesn’t make a difference? I beg to differ about a few billion missing.
There have not been this many bank failures since 1992 and the Savings and Loan Crisis. This number is nothing compared to the over 8,000 banks that failed during the Great Depression, but it seems like the failures have been coming at us with more force lately. The irony about all of this important information is that no one seems to be talking about it.
The collapse of the housing market, and the increase in mortgage delinquencies and home foreclosures, coupled with the credit crisis have all led to a dramatic increase in bank failures over the past few years. When banks fail, the FDIC is appointed as receiver. Depositors are protected up to the FDIC insurance limit.
The list of bank failures grew this weekend to 29 Bank failures for the year of 2009. What is alarming is that we are only 4 months into the year and we have surpassed all of 2008 bank failures ( 25 Bank failures). How does this bode for the rest of the year? How does this connect to the stress tests on the largest 19 banks? How solvent or insolvent are these leading banks?