Sunday, November 7, 2010

'belly up'-latest in thing for american banking companies

In signs of continuing financial woes, a staggering 141 American banks have gone belly up so far this year, surpassing the total count of bank failures in 2009. 

The world's largest economy saw the collapse of 140 banks last year, at a time when the country exited one of the worst recessions. 

Four banks -- Western Commercial Bank, Pierce Commercial Bank, First Vietnamese American Bank and K Bank -- were shut down by the authorities on November 5. 

According to the Federal Deposit Insurance Corporation ( FDIC), which insures deposits at over 8,000 American banks, the latest failures would cost more than $254 million. 

In October alone, 12 banks went out of business. Seven banks were closed down in September, while August saw the failure of ten entities. The maximum number of failures this year happened in April, when 23 entities went belly up. 

Official data showed that the count of 'problem' banks -- those at risk of failure -- climbed to a 17-year-high of 829 in the June quarter. 

Small and medium banks are facing the brunt due to rising defaults, triggered by high number of unemployed people.