In the years leading up to the Great Recession bank failures were almost unheard of. Then, in 2008, 26 banks were seized with many (IndyMac and Washington Mutual) making headline news. It took until 2010 for the number of failures to peak at 157 and it has been coming down slowly ever since. Thankfully, this year has seen fewer banks shut down than in any year since, 24.
Most banks have always been safe. But the Top 40 continue to show some of the most dangerous banks still out there. Perhaps the best way of describing this level of risk is to look at our projections for the 40th ranked bank in recent years:
Fall 2013: Cornerstone Bank of Duluth, Ga. has about a 37% chance of closing in the next year.
Fall 2012: Golden State Bank of Upland, Ca. had about a 54% chance. Today it is 6.6% (still risky by banking standards)
Fall 2011: Idaho Banking Company of Boise, ID at 76% (now 29%)
As you can see, the overall level of risk has fallen. But risky banks tend to take years to recover, if they ever do. As such, The Bank Blog intends to keep making new quarterly lists for some time to come. As banks fail, we will provide recaps as well. However, there will no longer be weekly notes when there are no failures as that is now the majority of weeks.
The Bank Blog
Saturday, December 28, 2013
Subscribe to:
Posts (Atom)