Why 96 Bank Failures (and counting) Are Bonanza For Healthy Banks

By TheBasisPoint, July 19th, 2010

The FDIC has closed 96 banks so far in 2010, including 6 on Friday. Here’s the FDIC Failed Bank List which shows which banks failed outright, depleting bank-funded FDIC reserves, and which were fully or partially taken over by other banks. When WAMU became the biggest-ever bank failure in the heat of the crisis, the FDIC realized their fund would disappear quickly so they and other bank regulators have become investment bankers of sorts, brokering deals for healthy banks to take over assets (loans) and/or deposits of the failing banks—in that case, the FDIC let JP Morgan Chase take over WAMU for a mere $2b. The Failed Bank List details all of these deals. For healthy banks, this is a golden era to cherry pick healthy loan books and/or pre-existing branch networks at deep discounts.

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http://www.thebasispoint.com/2010/09/20/2010-bank-failure-update-125-down-counting-are-mortgage-brokers-dying-off-stats/ 2010 Bank Failure Update: 125 Down & Counting. Are Mortgage Brokers Dying Off (stats)? | The Basis Point

[...] 2010 Bank Failure Update: 125 Down & Counting. Are Mortgage Brokers Dying Off (stats)? | Share | | Print Bank Failure Update: 125 Failures & Counting A total of six banks were shut down Friday, three in Georgia and one each in New Jersey, Ohio and Wisconsin, thus hitting the 125 mark for U.S. bank failures this year – and we’re not even done with the 3rd quarter. Gone are Bank of Ellijay, First Commerce Community Bank, and Peoples Bank, along with ISN Bank (NJ), Bramble Savings Bank (OH), and Maritime Savings Bank (WI). (Don’t ask me how the word “maritime” relates to Wisconsin.) Community & Southern Bank (GA) agreed to assume the assets and deposits of the 3 Georgia banks, in Pennsylvania New Century Bank’s logo, dba Customers Bank, will be placed over ISN’s Bank, in Ohio Foundation Bank is assuming the assets and deposits of Bramble, and lastly North Shore Bank is taking over Maritime. Here’s why bank failures are good for healthy banks. [...]
http://www.thebasispoint.com/2010/10/25/7-failed-banks-friday-139-failed-banks-so-far-in-2010/ 7 Failed Banks Friday, 139 Failed Banks So Far In 2010 | The Basis Point

[...] 7 Failed Banks Friday, 139 Failed Banks So Far In 2010 | Share | | Print The FDIC shut down 7 more banks Friday, bringing the 2010 failed bank total to 139. Below is a snapshot of the Friday failures, click the picture to see acquiring institutions for each. Here’s why bank failures are a bonanza for healthy banks. [...]
http://www.thebasispoint.com/2011/04/11/28-banks-failed-year-to-date/ 28 Banks Failed Year To Date | The Basis Point

[...] why bank failures are a bonanza for healthy banks. [...]

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