This year was the worst year for bank failures, according to the FDIC, since 1992, when the savings and loan crisis was visiting disaster upon the U.S. economy. All told, 157 banks failed in 2010, an increase over 2009, when 140 banks failed. In 2008, only 25 failed; in 2006, before the beginning of the financial crisis, there were no bank failures. However, back in 1992, 179 banks failed and two required assistance.
However, a bright spot in that news is the fact that fewer mortgage-related firms shuttered their businesses in 2010. Mortgage Daily's Mortgage Graveyard showed casualties in 2010 of 201 mortgage-related business operations that either failed or were taken over. This was an improvement over 2009, when 230 met their demise—the most since Mortgage Daily's tracking of the data began in 1998.
Non-bank closures tracked by Mortgage Daily numbered 22, showing tremendous improvement over 2009's 70; 2007 was the worst for those institutions, when 156 bit the dust. Credit union failures, said the publication, also totaled 22, up from 20 seizures and liquidations in 2009.
As of Sept. 30, the list of banks that the FDIC regards as "troubled"—with weaknesses that "threaten their continued financial viability"—was 860. That's the highest number of at-risk banks since 1993. If that list stays true to form, about 20% of those banks will fail.
Although the FDIC's insurance fund is currently in the red (to the tune of some $8 billion, as of Sept. 30), the agency says it will have enough money to cover the costs of all anticipated failures through 2014. The banks that failed this year on average were much smaller than those which failed in 2009; their assets totaled $92.1 billion, 45.7% less than 2009's banks at $169.7 billion.
Nearly half the banks that failed in 2010 had headquarters in four states: California, Florida, Georgia and Illinois.
| Bank Failures by Month in 2010 | |
| January | 15 |
| February | 7 |
| March | 19 |
| April | 23 |
| May | 14 |
| June | 8 |
| July | 22 |
| August | 10 |
| September | 9 |
| October | 12 |
| November | 10 |
| December | 8 |
Bank failure history (by month): http://www.fdic.gov/bank/historical/bank/index.html
Failed bank list from 2000 to present (with downloadable Excel file http://www.fdic.gov/bank/individual/failed/banklist.csv): http://www.fdic.gov/bank/individual/failed/banklist.html
Prior to 2000: http://www2.fdic.gov/hsob/SelectRpt.asp?EntryTyp=30
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