Bank Failures in the U.S.

According to the FDIC, there were 8,012 banking institutions as of April 2010.
According to the FDIC, there were 8,384 banking institutions with $13.6 trillion of assets as of September 2008.

In 1929, only nine months after the inauguration of Herbert Hoover, the Council on Foreign Relations engineered the Great Crash of 1929. The crash was the most significant fruit of the new Federal Reserve—the system initiated to prevent such occurrences. Between 1923 and 1929, the Federal Reserve inflated the nation's money supply by 62 percent. In the year before the crash, more than 500 banks failed nationwide. The stage was now set for disaster. — A Historical Perspective on the Financial Meltdown

Total U.S. Bank Failures in 2010 as of December 17: 157
Total U.S. Bank Failures in 2009 as of December 31: 140
Unofficial Problem Bank List as of May 7, 2010
Problem Bank List Jumps to 829 (July 2010)
Problem Bank List Jumps 27% to 702 (December 2009)
Problem Bank List Rises to 416 (August 2009)
Problem Bank List Tops 300 (March 2009)
As of August 14, 2009, FDIC is Bankrupt
Full List of Bailed-out Banks
The 171 Banks for Which the Margin of Failure Is One Thousand Dollars

Nearly 100 Bailed-out Banks May Collapse All the Same

December 27, 2010

Raw Story - Nearly 100 bailed out banks may collapse all the same: analysis

More collapsing banks could mean more 'too big to fail' banks

The $700-billion bank bailout, launched in the final months of the Bush administration, was meant to save US financial institutions from a systemic collapse. But an analysis of banks' earnings statements concludes that nearly 100 bailed-out banks are at risk of collapsing all the same.

Despite receiving a total of $4.2 billion in bailout cash, 98 US banks are at risk of failing, the Wall Street Journal reports.

The banks are suffering from “eroding capital levels, a pileup of bad loans and warnings from regulators,” the Journal reports, and the nature of the problem indicates that these banks were in trouble before the 2008 crisis hit -- a sign that the US's regulatory structure for banks may have been insufficient for years or decades before the collapse.

So far, seven bailed-out banks have already collapsed, costing taxpayers $2.7 billion.

Chris Cole of the Independent Community Bankers of America argued to the Journal that the smaller banks at risk of collapse didn't have access to all the same financial instruments that the larger banks had.

For example, the Federal Reserve ran an emergency liquidity program for the large Wall Street banks, giving them short-term loans to keep them stable. Last fall, after pressure from Congress, the Fed released the names of the recipients of $3.3 trillion in emergency aid. Among them were Bank of America and Wells Fargo, as well as a number of foreign banks, including Switzerland's UBS and France's Societe Generale.

But smaller, regional US banks did not have access to this program, and relied on the $700-billion TARP program passed by Congress. That program was never meant to help out banks that were in trouble prior to the crisis -- but as the Journal's analysis shows, many of these banks may have been "in parlous shape from the beginning."

In all, the Journal analysis found that more than 10 percent of the US's 7,760 banks are in financial trouble. Should more banks fail, it will likely result in greater concentration of banking in the hands of fewer banks. Many economists have argued that the creation of "too big to fail" banks through mergers poses a serious hazard for the economy, as these banks can feel comfortable taking on unnecessary risk, knowing they can count on a taxpayer bailout if they fail.

Because many of the larger banks are now in good health and have been able to repay bailout funds, the TARP program may itself not turn out to be as large a burden on taxpayers as once feared. According to the New York Times, the program -- which ended this fall -- could end up costing "a fraction" of the original cost, "and could conceivably earn taxpayers a profit."

But it may not rescue many of today's ailing banks. Arthur Wilmarth, a banking and law expert at George Washington University, told the Journal that many of these banks are saddled with commercial real estate loans that will never pay off.

"A lot of them are in kind of a frozen position," he said.