FDIC Problem Bank List Now Includes 171 Banks
In just three months, the number of problem banks has gone up from 117 to 171, an increase of 46%!
When the FDIC released its second quarter bank profile in August, the agency said it has 117 banks on its watch list, a record number at that time. Today, in the third quarter FDIC bank profile report (PDF file), the number of troubled banks surged to 171, while assets at these problem banks also saw a big jump, growing from $78.3 billion in the second quarter to $115.6 billion at the end of the third quarter. According to the FDIC, this is the first time since 1994 that assets at problem institutions have exceeded the $100 billion mark. The report also includes some disturbing numbers regarding the health of the nation’s financial institutions:
- Bank net quarterly income at $1.7 billion, a decline of $27 billion, 94%, from the third quarter in 2007, the second lowest since 1990;
- Loan loss provisions surged to $50.5 billion during the third quarter, more than three times the loss during the same period a year ago;
- 73 institutions were absorbed during the third quarter in mergers;
- Nine banks failed in the third quarter, the highest quarterly failure in 15 years, with the failure of Washington Mutual being the largest ever in the agency’s 75-year history (9 already in the first two months of the fourth quarter).
Yesterday, Citigroup again has to be rescued by the government when it received another $20 billion bailout money on top of the $25 billion it already got. Not sure whether Citi will be put on the problem bank list next quarter. If it is included, then you can expect another leap in troubled assets when the FDIC releases its fourth quarter report.
*Photo from Digitaljournal.com
This article was originally written or modified on . If you enjoyed reading this post, please consider subscribing to my full RSS feed. Or you can also choose to have free daily updates delivered right to your inbox.