17 Banks Fail As of Jan 28th 2011

[Norwayguy]

Just a quick update, the FDIC has closed 17 this year as of Jan 28th 2011

FirsTier Bank of Colorado Fails – Depositors Facing Losses | Problem Bank List

Also the FDIC has failed to find a buyer for First Tier Bank of Colorado so large depositors in excess of the FDIC limit will be facing losses.

The odds of losing money in a failed bank may be higher than most people realize. During 2010, there were 8 payoffs by the FDIC for failed banks that the FDIC could not sell. The 8 payoffs represented over 5% of all bank failures during 2010. During 2009, ten banks failed that could not be sold by the FDIC.

I'm not suggesting that you try and scare your clients out of thier bank accounts...Bank deposit accounts are still very safe accounts...I just want to keep people posted.
- - - - - - - - - - - - - - - - - -
Quick Update First Tier is the second bank this year that the FDIC has failed to find another institution to acquire the the deposits and thereby protect the large depositors.

 

[Charpress]

And 11% of all FDIC insured banks are now on the FDIC problem bank list.

That ain't good.

 

[pcwest]

I'm sure you still have clients that think banks are safer than insurance companies.

I love to pull up the FDIC website and sit back and wait for the clients to make the first comment.

 

[secondcreek]

Are the banks still dealing with subprime residential loans or has it spread over to commercial loans?

With so many retail developments with empty storefronts I keep wondering how these properties are paying their loans.

 

[VolAgent]

Are the banks still dealing with subprime residential loans or has it spread over to commercial loans?

With so many retail developments with empty storefronts I keep wondering how these properties are paying their loans.

Many of them aren't, they are either in foreclosure or are already bank owned.

 

[JFBAgent]

Genworth is reporting a 4Q loss, due to the sheer number of mortgages that they insure defaulting. They state that the losses are double what they were 3Q and 5 times what they were one year ago.

The problem is accelerating...

 

[Norwayguy]

3 Banks closed by FDIC on Feb 4th.

 

[Mark]

Didnt we just bail out the big banks?

 

[Norwayguy]

Didnt we just bail out the big banks?

If you spend time reading some of the releases these are small to mid size banks...One of the three closed in Feb so far had only 1 branch in Chicago, IL....I'm just finding it scary how many banks are failing....Things will remain somewhat okay as long as the FDIC can continue to find other banks to assume the deposits etc....but if this trend headed towards the larger banks it would require the Federal Government to fund the bailouts above and beyond the FDIC and the fact is the US doesn't have the money. Spend some time poking around FDIC.gov and you will come away amazed at what is going on...

Having said all that I don't believe this info is somethine to be used in the process of a sale and I would only reluctantly discuss it with a client if they specifically brought it up...I think consumers losing trust in banks could translate into mistrust of insurance carriers just as quickly or faster.

 

[Norwayguy]

2nd UPDATE: US Regulators Close Two Georgia Banks, One In California - WSJ.com

This brings to 11 banks the FDIC has closed in February as of the 18th.