Beware 1,000 Bank Failures on the Horizon
Managing Director at FBR Capital Markets Paul Miller was recently interviewed by The Wall Street Transcript and issued a disconcerting warning… he sees 1,000 bank failures on the eminent horizon.
He cites specific regions and figures to support his perspective. He stated, “Illinois didn’t have a big run-up in its housing market, but yet it’s leading – one of the leading states – in bank failures because so many of its banks are just not big enough to overcome the crisis. I think every region is unique. There are 8,000 banks out there, of which probably close to 1,000 will fail over the next couple of years.”
Miller expects that the banking system will support the casualties fairly well, because he anticipates that most of the bank failures will be smaller, regional players. We’re more concerned about the bigger institutions that may get caught up in the disarray. Not to mention the ever dwindling FDIC deposit insurance fund…
More of the interview can be found in The Pragmatic Capitalist’s post on “mind-boggling” bank failures.