More Bank Failures

From this morning's Wall Street Journal:

The largest number of bank failures in nearly 20 years has eliminated jobs, accelerated a drought in lending and left the industry's survivors with more power to squeeze customers.

Some 279 banks have collapsed since Sept. 25, 2008, when Washington Mutual Inc. became the biggest bank failure on record. That dwarfed the 1984 demise of Continental Illinois, which had only one-seventh of WaMu's assets. The failures of the past two years shattered the pace of the prior six-year period, when only three dozen banks died.

Two more banks went down last Friday, and failures are expected to "persist for some time," according to a report issued Tuesday by Standard & Poor's. In the second quarter of this year, the Federal Deposit Insurance Corp. increased its number of problem banks by 6% to 829.

The article continues on to explain that the number of U.S. banks could fall to 5,000 over the next decade from the current 7,932.

Locally, the bank I've used since I was a high school punk has consolidated four times in the last few years.

I remember watching an interview sometime in 2009 where some guy from the FDIC said we'd have lots of small bank failures over the next several years, but it wasn't going to be a big deal because they would be small banks with "only" a few billion in assets per bank.

"Only" a few billion dollars can add up when you have so many banks across the nation in trouble.

As we run into the election in a little over a month, I am amazed that issues like this aren't ever mentioned. I guess it won't excite voters. But problems like this sure concern me, especially when the ripples of these closures are going to affect us for years to come in so many different ways... and when there is no end in sight.