Friday, May 21, 2010

One-Tenth of All U.S. Banks on FDIC Problem List, But Not the Banksters

"The banking system still has many problems to work through, and we cannot ignore the possibility of more financial market volatility," FDIC Chairman Sheila Bair said, reports WSJ .

Regulators have shut 72 banks so far this year, more than double the number closed by this time last year. Ms. Bair said regulators were preparing for a steady pace of additional closures through the end of the year. A total of 237 banks have failed since the beginning of 2008.

"There is a lot of credit distress still in the mortgage-portfolio area," FDIC Chief Economist Richard Brown said at the FDIC briefing for WSJ.

The FDIC data, according to WSJ, suggested that the largest U.S. banks were faring better than their smaller rivals--which should come as no surprise since they are the ones that received bailout money and trade, as primary dealers,  opposite the Fed, where they have been gifted profits through trades.

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