FDIC Bank Failure Report

Last week, the Federal Deposit Insurance Corporation closed three banks: Corus Bank (Chicago, Illinois); Brickwell Community Bank (Woodbury, Minnesota); and Venture Bank (Lacy, Washington). Total assets of the closed banks were $8,042,000,000. The cost to the FDIC is estimated at $2,020,000,000. The percentage of FDIC loss out of total assets is 25.12%.

This closure brings the total assets of FDIC-failed banks (since December of 2007) to $471,296,780,000, with cost-to-FDIC brought to $38,783,800,000 - this includes the assets of Washington Mutual, whose closing offered no cost to the FDIC. The percentage of FDIC losses to total assets presently stands at 8.23%, up from 7.87% as of last report.

Upon elimination of WaMu's assets from the analysis, total assets are $164,296,780,000, and total cost is $38,783,800,000. The percentage of FDIC losses to total assets now stands at 23.61% up from 23.53% as of last report.

The situation with Corus Bank requires additional examination. The acquiring institution, MB Financial Bank, agreed to take ownership of $3 billion (out of $7 billion) of ex-Corus assets, leaving $4 billion in the capable hands of the FDIC. The raw losses-to-assets ration is 24.29%; however, taking MB Financial's actions into account, and the extimated cost-to-DIF of $1.7 billion, the actual losses-to-assets stands at an whopping 42.50%. Because of the severity of this different, we're going to be looking closer at past closures, as it is entirely possible that closures have been altogether worse than we previously thought.

On the basis of the ratio of bank closures to population, and the ten most afflicted states are:

1. Nevada
2. Georgia
3. Illinois
4. Utah
5. Kansas
6. Minnesota
7. Oregon
8. Missouri
9. Washington
10. Florida

On the basis of the total losses-to-assets ratio in each state, the worst are as follows:

1. Pennsylvania - 50.75%
2. Utah - 40.32%
3. Idaho - 39.11%
4. Michigan - 39.03%
5. Wyoming - 38.57%
6. Florida - 37.62%
7. Iowa - 36.68%
8. West Virginia - 36.52%
9. Nevada - 35.56%
10. Arizona - 34.45%