Saturday, October 3, 2009

Bank Failures: counting ‘em up

Here’s how bank failures have stacked up since the beginning of this failure cycle in 2007. The estimated DIF damage figure is pulled from FDIC press releases. The ultimate cost of many of the older failures may have differed significantly from initial esimates.

2007

  • Number of failed banks: 3
  • Vitals: assets of $2.6 billion, deposits of $2.4 billion
  • Estimated DIF damage: $113 million
  • Biggest failure: NetBank — $2.5 billion assets/$2.3 billion deposits/DIF damage: $110 million

2008

  • Number of failed banks: 25
  • Vitals: assets of $372 billion, deposits of $233.2 billion (WaMu = $307b and $188b respectively)
  • Estimated DIF damage: $17.1 billion
  • Biggest failure: WaMu, $307b assets/$188b deposits/DIF damage: $0
  • Most expensive failure: IndyMac — $32b assets/$19.1b deposits/DIF damage: $10.7b

Q1 2009

  • Number of failed banks: 21
  • Vitals: assets of $9.6 billion, deposits of $7.9 billion
  • Estimated DIF damage: $2.3 billion
  • Biggest failure: County Bank, Merced CA — $1.7b assets/$1.3b deposits/DIF damage: $135m
  • Most expensive failure: Omni National, Atlanta — $1.0b assets/$800m deposits/DIF damage: $290m

Q2 2009

  • Number of failed banks: 24
  • Vitals: assets of $26.5 billion, deposits of $19.6 billion
  • Estimated DIF damage: $9.0 billion
  • Biggest failure: BankUnited — $12.8b assets/$8.6b deposits/DIF damage: $4.9b
  • Most expensive failure: see above

Q3 2009

  • Number of failed banks: 50
  • Vitals: assets of $68.7 billion, deposits of $60.0 billion
  • Estimated DIF damage: $14.9 billion
  • Biggest failure: Colonial Bank — $25.0b assets/$20.0b deposits/DIF damage: $2.8b
  • Most expensive failure: Guaranty Bank — $13.0b assets/$12.0b deposits/DIF damage: $3.0b

GRAND TOTALS

  • Number of failed banks: 123
  • Vitals: assets of $479 billion, deposits of $323.2 billion
  • Estimated DIF damage: $43.4 billion

4 comments:

  1. The FDIC's Clever Accounting Trick
    (link)

    How will the FDIC replenish its coffers without Sheila Bair suffering the indignity of groveling in front of Tim Geithner? Clever accounting.The plan is for the FDIC to require banks to pre-pay three years of assessments. As with everything else in the economy (cash for clunkers, the $8,000 homebuyer tax credit), the idea is to pull it forward.The FDIC gets the cash now, the banks take a hit -- but one that they can expense over three years, as Karl Dnninger points out -- and voila, free money.

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  2. If the FDIC Is Broke, Why Are They Still Issuing Guarantees?
    from Seeking Alpha:

    Wow. Wow. Can I say WOW again? If the FDIC is broke, which they are, then why is the TLGP program still going?!! Ken Lay would be proud - Citibank issues debt guaranteed by the (broke) FDIC. Then, Citi prepays a few years' worth of fees to the FDIC, so that they'll have money to, amongst other things, be able to make good on the debt they just guaranteed for Citigroup! If you plugged this into Excel, you'd get a "#N/A" circular reference error.

    Perhaps it went down something like this:

    The Players:
    Vikram Pandit: Citi CEO
    Sheila Bair: FDIC chair
    Pandit: "Hey Sheba - what's shakin'? Look - We need to issue some debt under the TLGP - no problem right?"

    Bair: "Hi Vik - ummm - actually, I don't know if you got the memo - we're broke."

    Pandit: "That's ok Sheba - you won't actually have to pay out on the debt - it's guaranteed."

    Bair: silence... "Sorry Vik - I don't follow."

    Pandit: "It's guaranteed - RISKLESS! The full faith and credit of the FDIC stands behind it."

    Bair: annoyed... "But Vik, I don't have any money to guarantee it."

    Pandit: "You old fuddy duddy - don't worry about that - we'll use the proceeds of the debt sale to prepay our FDIC fees for the next three years - then you'll be able to cover us - simple math!"

    Bair: hesitant... "ummm. Ok Vik - what happens when you need to payback the debt?"

    Pandit: "Where have you been Sheba? We'll just issue new debt! Voila!"

    Bair: "Genius, Vik. Do it up! GUARANTEED!"

    Ponzi lives. Smoke and mirrors.

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  3. Thanks for the data, 8MH.

    It seems that the banks they are saving are to ones that too big to fail and most likely to be the cause of the next collapse. I think they need to be broken up, because if they are not, they will blackmail the taxpayers into financing their greed-induced failures again and again.

    Too big to fail = Too big to EXIST!!

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  4. Hi 8 and everyone else! This is my first post here! I still have to figure out how to maneuver through the site!

    Thanks for getting me over here today...I got hung up...

    ReplyDelete