As of follow up to my post from yesterday, I wanted to highlight data just released from the FDIC.
Here is a quick summary:
- bank profits are down 86%
- 117 banks and thrifts are considered to be in trouble
- 8500 banks reserved $50.2 billion to cover losses from bad mortgages
By no means are the results stellar and, frankly, they are down right ugly; however, the industry is NOT on the verge of collapse.
The most interesting quote from the entire article was glossed over, contained to only one line:
The majority of U.S. banks “will be able to weather” the economic and housing storms, with 98 percent of them still holding adequate capital by the regulators’ standards, Bair said.
Interesting how single piece of good news, the bit of information that is the most pertinent, is given no real attention or priority. The FDIC Chairman is telling the world that 98% of the US banks are fully funded as of today but the press doesn’t seem to care about that. Why? It doesn’t grab your attention, it doesn’t “sell papers.”
Look past the doom and gloom fed by the press and you’ll see that, despite the hard times the industry is facing, it is not the end of the world.
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