what are the odds of the "personal" banks going under? (i.e PNC, etc)

[charlie and algernon]

I know the shit has hit the fan in regards to the big investment banks, but what about the personal banks, the ones on every street corner. Are we close to having them fail as well? which of course would be utterly catastrophic for the ordinary person.

[Political Heretic]

1. Washington Mutual (my former bank) already did.

[avaistheone1]

22. Washington Mutual is a major bank.

[jtrockville]

2. Isn't that what the FDIC is for?

[willing dwarf]

3. FDIC funds are running low.

These are crazy times!

[burythehatchet]

6. You are correct. I believe the FDIC's reserve is about 40 Bn. Far less than

what would be required if commercial banks failed en masse.

[yodoobo]

12. If the FDIC runs out, they just get more

You can never run out of money, when your parent organization has the power to print more.

The government will issues bonds and it will fund the FDIC up to the level necessary.

In fact, I suspect that FDIC failure will be the next big crisis.

Complete with all the drama that we saw this week.

But by the end of that week. there will be a bailout announced of FDIC.

[shadowknows69]

4. Our main local bank is booming

Opened like 3 new branches in the last 10 years in the city. They're responsible for most of the local business financing. I think homespun banks might be the ones to survive this. Maybe that's why Wall St. is in trouble. Not enough players? People are losing faith in big corporate structures.

[galileoreloaded]

10. Any bank with a recent , say 5-10 year expansion is suspect...

they make money when everybody makes money, nobody is making any money, and now they have additional overhead, leverage, etc.

July retail demand deposits, or in English, a "everyday" bank, were down 8% in July, nationally. An 8% reduction in business for one month is bad enough, but with fractional banking, that is a MONSTER number to overcome, and banks that aren't laying off, will be quite soon.

[Spike from MN]

5. Here's a list of failed banks.

It might not answer your question but at least you can look at the list and see if there are any trends.

http://www.fdic.gov/bank/individual/failed/banklist.html


I've been wondering the same about credit unions.

I believe most (if not all) credit unions have always been a lot more stringent in their lending practices so perhaps they are a bit more immune from everything else that is happening. Hopefully the same is true with small "personal" banks.

Also, credit unions are insured through NCUA, not FDIC. (Well, at least mine is anyway. I can't say if that's true for all credit unions.) Would that put them in a better position even if a credit union should fail? IOW, is NCUA more solvent than FDIC?

[MadrasT]

8. Here's a statement I got last week from my credit union (PSECU)

Pennsylvania State Employee's Credit Union:

Dear (MadrasT),

I've written to the membership two times in the past year as the domestic and global financial markets churned. My purpose in writing then and now is to reassure members of PSECU's financial stability.

Over the past two weeks, we've seen amazing changes in the financial markets as some of our country's largest financial firms have stumbled. Fortunately, PSECU is not subject to the problems faced by those other firms. Here are the facts you should know concerning your accounts with PSECU:

• All accounts are federally insured up to $100,000 by the National Credit Union Share Insurance Fund (NCUSIF). The NCUSIF is similar to the Federal Deposit Insurance Corporation (FDIC) which insures bank deposits. Both funds are backed by the full faith and credit of the United States government. In addition to the $100,000 coverage, members with IRAs are further insured up to another $250,000. (Learn more about NCUSIF.)

• PSECU's primary asset is loans to our members. The health of that asset is measured by what we call a delinquency ratio. As I wrote in my earlier messages to the membership, our current delinquency ratio stands at 0.61%. That means that 99.39% of our loans are paid on time by members like you. This is the same ratio that I cited when I wrote in March and again in July. In other words, in spite of the turmoil in the outside world, our members continue to pay their accounts to PSECU on time. Thank you for that.

• The money that we don't lend to members is invested in federally insured or federally backed securities. State and federal regulations restrict our investments to these more secure investments.

• PSECU has never participated in subprime lending of any type and our real estate loans to members represent only 19% of our total assets. Our real estate loans are concentrated in Central Pennsylvania, not California or Florida. Central Pennsylvania has not faced the tremendous decline in property values that those other states have experienced.

• PSECU's reserves currently stand at $270 million against assets of $3.2 billion. Those reserves provide a cushion to protect the membership against economic hard times. They are more than adequate for the environment we currently face.

• PSECU's net income through August 2008 is $19.3 million. That's $3.5 million ahead of our net earnings for August 2007. Those earnings will go back into our reserves to make PSECU's foundation even stronger. We post our financial statements on our Web site each month. (View August's Financial Statements.)

These are very challenging times but the good news is that PSECU remains strong and ready to help you, our members, with your financial needs.

Sincerely,
Gregory A. Smith
President

It was reassuring to me.

[Spike from MN]

18. Thanks for the info.

Looks like they're in good shape. I think I'll call my CU tonight and ask a few questions.

I'll have to bookmark this for later. Say, MadrasT, since your CU is hunky-dory, you wouldn't mind cashing a check or two for me a few weeks from now if the need arises, would ya? ;)

[Holly_Hobby]

15. I've had difficulty getting cash from my credit union the past week

I went in last week to withdraw $700....they gave it to me in $100's, I asked for 20's. They said, "We're a Credit Union, not a bank."

Their ATM has been empty since then. I've been using ATM's at grocery stores.

[Spike from MN]

20. Damn. I had no trouble getting cash a few days ago.

Then again, I was only getting $50 or so for my "carrying around" money. I asked the teller how things had been going and she did say some people have been coming in and pulling cash out, usually to get the amount of their account under $100,000. Of course, I'm one of those lucky bastards that will never even remotely have to worry about hitting that $100,000 ceiling so I left my money where it was.

I was going to shift some money to an online savings account to get a better rate of return but I'm starting to have second thoughts on that. The online savings is FDIC insured but I'm not sure if that means much these days. The transfer would only be for a few months as I'll be pulling the money back at the end of the year so I'm not sure if it will really be worth it. Higher interest rate vs. stress worrying about FDIC. Tough call.

[Holly_Hobby]

21. I just got back from my credit union.......

they're limiting cash withdrawals to $300/day per account! That includes ATM withdrawals too.

[BlooInBloo]

7. Er.... WaMu WAS a "personal" (the word is "really "retail") bank.

[gopbuster]

9. 50-50 odds right now

50-50 odds right now



Largest Banks and Thrifts Believed to Be at Risk of Failure

Citibank NA C- 279% 1,292.5
Wachovia Bk NA C+ 78% 665.8
Washington Mutual Bank D+ 317.8
HSBC Bk USA NA D+ 721% 188.3
SunTrust Bk C- 174.7
National City Bk D 152.5
Sovereign Bk D+ 81.9
Huntington NB D+ 55.6
E*Trade Bank D+ 48.2
First Tennessee Bk NA D+ 37.1


The analysis is based on:
1. TheStreet.com Financial Strength Rating of D+ or lower, reflecting low scores
in capital adequacy, asset quality, liquidity or other factors. In the table above,
three banks with a rating of C- or higher are included due to other weaknesses not
reflected in TheStreet.com Financial Strength Rating, as specified below.
2. Credit exposure to derivatives, as reported in the OCC’s Quarterly Report on
Bank Trading and Derivatives Activities, First Quarter 2008, shown above as a
percentage of risk-based capital.
3. Exposure to mortgages and mortgage-backed securities.


U.S. Banks and Thrifts Believed to Be at Risk of Failure

As stated in Part I, banks and S&Ls at risk have assets of $3.2 trillion, or 41 times
the assets of banks on the FDIC’s watch list. These include the assets of Citibank
NA, Wachovia Bank NA and SunTrust Bank cited in Appendix A above, plus the
assets of the banks and thrifts listed below.

U.S. Banks and Thrifts Believed to Be at Risk of Failure
(All institutions with a Financial Strength Rating of D+ or lower)
Bank or Thrift City State
TheStreet.
com
Rating
Total Assets
($ thousands)
Washington Mutual Bank Henderson NV D+ 317,823,952
HSBC Bk USA NA Wilmington DE D+ 188,284,200
National City Bk Cleveland OH D 152,519,145
Countrywide Bank, FSB Alexandria VA D 121,412,048
Sovereign Bk Wyomissing PA D+ 81,906,412
Huntington NB Columbus OH D+ 55,566,801
E*Trade Bank Arlington VA D+ 48,184,276
First Tennessee Bk NA Memphis TN D+ 37,063,967
LaSalle Bank Midwest NA Troy MI D 37,008,195
IndyMac Bk FSB Pasadena CA E- 32,010,816
Goldman Sachs Bk USA Salt Lake City UT D 25,573,236
Amtrust Bank Cleveland OH D- 17,301,384
Firstbank of PR San Juan PR D+ 17,173,199
Westernbank Puerto Rico Mayaguez PR D- 15,971,230
Flagstar Bk FSB Troy MI D- 15,898,386
Chevy Chase Bk FSB McLean VA D+ 15,130,114
BankUnited FSB Coral Gables FL D+ 14,312,695
Downey S&LA FA Newport Beach CA D- 13,130,348
Banco Popular North America New York NY D+ 12,738,302
Lehman Brothers Bk FSB Wilmington DE D- 12,246,720
Sterling Savings Bank Spokane WA D+ 12,189,506
Banco Santander PR San Juan PR D 9,103,575
Corus Bk NA Chicago IL D 8,976,744
Doral Bank Puerto Rico San Juan PR D 8,835,752
R-G Premier Bk of PR San Juan PR D+ 7,165,822
Barclays Bank Delaware Wilmington DE D 7,125,125
First Federal Bank of CA FSB Santa Monica CA D+ 7,083,638
BankAtlantic Fort Lauderdale FL D 6,212,631
Fremont Investment & Loan Anaheim CA E 6,047,598
Franklin Bk SSB Houston TX D- 5,922,659
Irwin Union Bk Columbus IN D+ 5,425,343
Amcore Bk NA Rockford IL D+ 5,135,631
Ocean Bk Miami FL D- 5,120,611
Anchorbank FSB Madison WI D+ 5,088,062
PFF B&T Pomona CA E+ 4,103,786
Hanmi Bk Los Angeles CA D+ 3,927,609
Imperial Capital Bk La Jolla CA D+ 3,530,257
Weiss Research, Inc. 21
First Community Bk Taos NM D+ 3,455,652
TierOne Bk Lincoln NE D 3,374,893
First Place Bank Warren OH D+ 3,283,975
Independent Bk Ionia MI D- 3,238,995
BLC Bank, NA Strasburg PA D- 3,178,636
Superior Bank Birmingham AL D 2,943,775
Orion Bk Naples FL D 2,936,394
First NB of AZ Scottsdale AZ E+ 2,836,085
Eurobank San Juan PR D- 2,792,787
Home S&LC Youngstown OH D 2,716,625
Amboy Bank Old Bridge NJ D- 2,695,636
West Coast Bk Lake Oswego OR D 2,607,534
Meridian Bank NA Wickenburg AZ D 2,505,730
Bank of the Cascades Bend OR D+ 2,403,853
Seacoast NB Stuart FL D- 2,391,360
Vineyard Bk, NA Rancho Cucamonga CA D 2,326,862
Macatawa Bk Holland MI D 2,133,420
Americanwest Bk Spokane WA D 2,106,351
Citizens First Svg BK Port Huron MI D+ 2,091,041
County Bk Merced CA D 2,078,298
Intervest NB New York NY D+ 2,046,601
Lydian Private Bank Palm Beach FL D+ 2,008,561
New South FSB Irondale AL D 1,986,425
ANB Financial NA Rogers AR F 1,895,545
Hillcrest Bk Overland Park KS D- 1,882,968
Great FL Bk Miami FL D+ 1,850,387
Guaranty Bank Milwaukee WI D- 1,826,503
Wauwatosa Svgs Bk Wauwatosa WI D+ 1,771,794
Fidelity Bk Norcross GA D+ 1,732,780
First NB of Nevada Reno NV D- 1,634,041
Silver St Bk Henderson NV D 1,624,672
Premier Bk Jefferson City MO D- 1,569,820
Ameriprise Bank, FSB New York NY D 1,551,509
Mutual Bk Harvey IL D- 1,532,589
Scotiabank DE PR Hato Rey PR D- 1,529,267
TIB Bank Naples FL D+ 1,423,951
First Bank of Beverly Hills Calabasas CA D+ 1,410,692
Bridgeview Bk Group Bridgeview IL D+ 1,403,902
Temecula Valley Bk Temecula CA D 1,373,343
Security Bank of Bibb County Macon GA D- 1,315,478
Integrity Bk Alpharetta GA E- 1,203,701
Bank of Granite Granite Falls NC D 1,192,025
Merrick Bank Corp S Jordan UT D+ 1,181,376
First Mariner Bk Baltimore MD D- 1,172,860
Affinity Bk Ventura CA D- 1,172,207
Eastern Svgs Bk FSB Hunt Valley MD D 1,132,481
Alliance Bk Culver City CA D- 1,111,157
OmniAmerican Bank Fort Worth TX D 1,086,199
Baylake Bk Sturgeon Bay WI D 1,078,889
Fidelity Bank Dearborn MI D 1,045,530
Weiss Research, Inc. 22
Midcountry Bank Marion IL D- 1,025,760
Omni NB Atlanta GA D- 992,505
Founders Bk Worth IL D 980,356
LibertyBank Eugene OR D 960,085
Avidia Bank Hudson MA D+ 954,640
Inter Svgs Bk FSB Maple Grove MN D- 951,692
Crescent B&TC Jasper GA D+ 950,001
Buckhead Community Bk Atlanta GA D- 943,151
Florida Community Bk Immokalee FL E+ 935,236
Century Bk FSB Sarasota FL D- 929,123
Vision Bk Panama City FL D- 922,174
Heartland Bk Clayton MO D+ 892,367
First NB of GA Carrollton GA D- 882,993
Security Bk of Kansas City Kansas City KS D+ 880,439
Falcon International Bk Laredo TX D+ 871,386
Peoples Community Bank W Chester OH D- 870,486
Florida Choice Bk Mt Dora FL D 868,805
Park View FSB Cleveland OH D 868,702
Lincoln Bank Plainfield IN D+ 862,451
First NB of the South Spartanburg SC D+ 850,717
Millennium BCP Bank, NA Newark NJ D- 841,322
First Federal Bank Harrison AR D 828,860
Florida Capital Bank, NA Jacksonville FL D- 819,512
Home NB Blackwell OK D 815,543
MidWestOne Bk Oskaloosa IA D- 778,014
CapitalSouth Bank Birmingham AL D- 756,441
Bank of Blue Valley Overland Park KS D- 753,205
Mid-Missouri Bk Springfield MO D+ 752,747
Bank of East Asia USA NA New York NY D 748,859
One United Bk Boston MA D 742,866
First St Bk Eastpointe MI D 738,642
Columbian B&TC Topeka KS D- 735,766
Omni Bk Metairie LA D 727,864
First Niagara Commercial Bk Lockport NY D 717,088
Delaware County B&TC Lewis Center OH D 716,851
First Georgia Banking Co Franklin GA D+ 715,523
1st Centennial Bk Redlands CA D- 715,231
First St Bk Stockbridge GA D- 705,237
Teambank NA Paola KS D+ 704,541
Bank of Florida-Southwest Naples FL D+ 698,891
First Gulf Bank, NA Pensacola FL D+ 698,875
Irwin Union Bk FSB Columbus IN D+ 692,224
American Bk of Commerce Wolfforth TX D+ 690,847
Tower B&TC Fort Wayne IN D+ 687,243
Conestoga Bank Chester Springs PA D- 680,814
Haven SB Hoboken NJ D+ 680,150
Independence Bk Owensboro KY D+ 675,449
Sterling B&T FSB Southfield MI D- 670,627
Federal Trust Bank Sanford FL E- 670,589
Lowell Five Cents SB Lowell MA D+ 663,853
Weiss Research, Inc. 23
Beach Community Bk Fort Walton Bch FL D- 660,975
Alliance Bank Lake City MN D 651,634
Citizens-Union Svgs Bk Fall River MA D 649,190
K Bk Owings Mills MD D- 649,097
Redding Bk of Commerce Redding CA D 646,946
Gainesville Bank & Trust Gainesville GA D 646,373
First Central Svgs Bk Glen Cove NY D- 645,056
Ponce De Leon Federal Bk New York NY D+ 643,478
Bank of Choice Colorado Arvada CO D- 637,106
Vanguard B&TC Valparaiso FL D+ 633,756
Northwest Georgia Bk Ringgold GA D+ 633,733
BPD Bk New York NY D+ 632,610
Sovereign Bk NA Dallas TX D 632,482
Marine Bk-Springfield Springfield IL D 631,946
Community West Bk Goleta CA D+ 628,610
Community Bk Loganville GA E+ 623,764
Baltimore County Svgs Bk FSB Baltimore MD D 615,915
Republic Federal Bank, NA Miami FL D- 613,165
American Bk St Paul MN D 612,162
Peninsula Bk Englewood FL D- 606,312
Vantus Bk Sioux City IA D+ 597,030
Baraboo NB Baraboo WI D+ 596,978
Warren Bk Warren MI D- 587,082
Helm Bk Miami FL D+ 586,280
American River Bk Sacramento CA D 585,958
Security Pacific Bk Los Angeles CA D- 585,184
Northeast Bk Auburn ME D+ 583,816
1st United Bk Boca Raton FL D+ 575,509
Transatlantic Bk Miami FL D+ 573,742
First Bk Fncl Centre Oconomowoc WI D+ 571,327
Central Co-Op Bk Somerville MA D+ 570,835
Community South Bk Parsons TN D- 569,721
American Founders Bk Inc Frankfort KY D- 561,375
Bank of Choice Evans CO D- 560,922
Crescent B&TC New Orleans LA D+ 559,526
Northside Cmnty Bk Gurnee IL D 554,194
Alliance Bk Corp Fairfax VA D 553,450
Premier Bk-Maplewood Maplewood MN D- 552,769
Bradford Bank Baltimore MD D- 551,944
Signature Bk of Arkansas Fayetteville AR D 549,211
Equitable Bk SSB Wauwatosa WI D+ 548,555
Peachtree Bk Duluth GA E 545,076
Community Central BK Mt Clemens MI D- 544,704
FirsTier Bk Louisville CO D+ 542,909
First American Intl Bk Brooklyn NY D+ 542,634
Riverside Bk of Gulf Coast Cape Coral FL D- 535,046
Farmers & Merchants Bk Lakeland GA D- 534,414
Presidential Bk FSB Bethesda MD D+ 534,166
Geauga Svg Bk Newbury OH D+ 530,388
Builders Bk Chicago IL D- 527,387
Weiss Research, Inc. 24
Graystone Bank Lancaster PA D 524,412
Habersham Bk Clarkesville GA D- 520,216
Community First Bk Harrison AR D+ 519,235
Illinois NB Springfield IL D- 517,987
Southport Bk Kenosha WI D+ 510,740
Central Progressive Bk Lacombe LA D- 508,652
Highland Bk St Michael MN D+ 507,223
Magyar Bank New Brunswick NJ D 504,200
Truman Bk St Louis MO D 502,798
Westsound Bk Bremerton WA D- 502,789
Desert Hills Bk Phoenix AZ D+ 502,374
Data: Federal Deposit Insurance Corporation (FDIC), Call Reports, March 31, 2008, and
Office of Thrift Supervision (OTS), Thrift Financial Reports, March 31, 2008. Includes institutions that may have merged or failed since March 31, 2008.

source:http://www.weissgroupinc.com/bailout/Bailout-White-Paper-Sept-24-2008.pdf

[bikebloke]

19. Merde! My bank is on the second list.

They used to be solid, but I've grown suspicious over their expansions of late. Now I know. I have a couple back-up banks not on either list. But in three weeks, I'm making an overseas trip, so hopefully it won't go belly up until I'm back.

[yodoobo]

11. Its already happening

The smaller banks are failing but they are not in the news quite so much.

my bank failed last year. Netbank. http://www.fdic.gov/bank/individual/failed/NetBank.html

thanks to FDIC. It wasn't catastrophic at all.

Never lost access to my money. At all.

Only thing i lost was an online balance for a few weeks.

[rucky]

13. The farther they are down the chain, the less they depend on the Fed

and interbank lending to support them.

I'd look for an established local bank with a stable base of depositors. One that knows and serves its community and has conservative lending practices. You can look up their quarterlies on http://www2.fdic.gov/sod/sodInstBranch.asp?barItem=1

find banks in your Zip code, and look at their assets/deposits between this year and last year.

[pnutbutr]

14. Economic collapse will affect everyone

Even the small banks. They use the same money the big banks do.

[Redbear]

16. It depends on a lot of factors.

Overall economy. What assets they have. What type of loans they have.

[Junkdrawer]

17. In Pittsburgh, PNC is in much better shape than National City...

And, to answer your question, until the Fed runs out of money, the result of bank failures is that the Fed ponies up money and helps a larger bank buy the failing bank. The checking and under-$100,000 depositor may never know anything happened.

Until the Fed runs out of money....