2009 Ends With Fewer Banks In Business
LINDA WERTHEIMER, host:
Banks have been toppling all year and it looks like the total number of bank failures in 2009 will be 140. That's more than in any year since the end of the savings and loan crisis two decades ago.
NPR's Tamara Keith has more.
TAMARA KEITH: If 2008 was the year when bank failures burst back into the national consciousness with Indy Mac and WAMU, then 2009 was the year when they became routine.
Mr. ROBERT KLINGLER (Attorney, Bryan Cave): We didn't have this year pictures of depositors lined up outside of Indy Mac trying to withdraw their insured funds.
KEITH: Robert Klingler is a lawyer at the firm Bryan Cave in Atlanta. Klingler works closely with community banks and saw about a dozen of his client banks fail this year. Georgia had more bank failures than any other state - 25 in all.
Mr. KLINGLER: It is becoming routine in the macro sense, although each individual failure is still very traumatic.
KEITH: The failures this year were largely among community and regional banks hit hard by commercial and industrial loans gone bad. Mitchell Glassman with the FDIC says some banks are going to continue having problems.
Mr. MITCHELL GLASSMAN (Director of Resolutions and Receiverships, FDIC): So we're still going to have to work our way through this through 2010, but things look more promising after that.
KEITH: Which is to say the FDIC is bracing for more failures next year. All these failed banks costs the FDIC's insurance fund about $36 billion in 2009, that's double what the FDIC had to pay out the year before.
Tamara Keith, NPR News, Washington.
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