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Banking, finance, and taxes

Troubled Banks Jump Almost 50%… In One Quarter

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By Douglas A. McIntyre Updated Published
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burning-money-pic24The Federal Deposit Insurance Corporation has released its list of troubled banking institutions.  As you would have guessed, it is far from pretty.  The FDIC has said that as of the end of Q4 that there were some 252 problem banks, the largest since 1993.  There were 171 at the end of the third quarter.

The FDIC noted $26.2 billion in fourth quarter losses, the first loss since 1990.  The charge-off rate matched the highest on record.  The FDIC also said that the insurance fund lost $15.7 billion in the fourth quarter, and stated the obvious: loans continue to deteriorate.

Sheila Bair also went as far as to say that there are no quick fixes and that troubled loans will continue to rise.  She also noted that there is no sign of asset quality improvement.  None of us expected any improvement there, and most people do not expect things to get better any time soon.

Any guesses as how many troubled banks will be reported at the end of Q1?  Our guess is probably around 325 to 350.  And that is just the “official and what they are willing to admit” level.  We hope that number won’t be accurate.

Jon C. Ogg
February 26, 2009

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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