Seven Bank Failures Puts U.S. Way Ahead Of 2009
On April 30th, 7 banks were closed, including 3 in Puerto Rico, bringing this year’s total for bank closures to 64. That’s a figure that we didn’t hit last year until August. Based on the speed we’ve been at so far, we could conceivably hit 190 banks or more closed by the end of the year.
The closure of the Puerto Rican banks is somewhat stunning because there wasn’t a single Puerto Rican bank that closed in 2009 when things were really bad. In this case the three banks, Westernbank, Eurobank and R-G Premier Bank of Puerto Rico, close with a combined $14.84 billion in deposits. That will cost the FDIC around $5.28 billion.
The biggest bank to close on the day was in the state of Washington, where Frontier Bank, with $3.13 billion in deposits, and all 47 branches will be taken over by Union Bank, which is based in San Francisco. That’s also a dramatic change from last year, when banks that were closed were almost always taken over by other banks already in the state. It’s the second bank that Union took over in April, previously purchasing Tamalpais Bank, which was based in San Rafael, on April 16.
So it continues, but at least it’s not close to the rate that was predicted when it was forecast that 700 banks were in trouble.