02/27/10 Stockholm, Sweden – A new projection is now showing that roughly 1,000 US banks may fail because of the financial crisis that uncovered the toxic assets hidden on bank balance sheets.
According to Reuters:
“James Dunne, senior managing principal of Sandler O’Neill, said 300 to 400 banks could be seized this year, especially as institutions start to deal with deteriorating commercial real estate loans.
“‘This is going to be a very slow recovery,’ Dunne said in an interview with Reuters.
“Regulators have seized 185 banks since January 2008. The Federal Deposit Insurance Corp has said the pace of failures is expected to peak this year.
“The agency said earlier this week that its ‘problem’ bank list jumped 27 percent during the fourth quarter to 702.”
The trajectory is not good… banks continue failing at a rapid rate and the FDIC’s deposit insurance fund has already had a negative balance for quite some time.
Read more about bank failures on the horizon in Reuters coverage of the tally hitting 1,000.
Rocky Vega
Rocky Vega is publisher of The Daily Reckoning. Previously, he was founding publisher of UrbanTurf and RFID Update, which he operated from Brazil, Chile, and Puerto Rico, and associate publisher of FierceFinance. He specialized in direct marketing at MBI, facilitated MIT Sloan School of Management programs, and has been featured on CBS. Vega graduated with honors from Harvard University, where he was on the board of Let’s Go Publications and directed business programs involving McKinsey, Goldman Sachs, and Harvard Business School faculty. He is also enrolled at the Stockholm School of Economics.
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