Banking & Finance

2010 Bank Closings Hit 81, Costs May Hit $100 Billion

The FDIC closed three banks Friday bringing the total to 81 for this year. The news raises the question of whether the $45 billion that the agency raised last year by getting members banks to prepay premiums through 2012 will be enough. If it is not, the FDIC will have to turn to the US Treasury for funds, adding to the taxpayer costs for bailing out the banking system, the largest portion of which has been the TARP.The FDIC closed TierOne Bank, Lincoln, NE Arcola Homestead Savings Bank, Arcola, IL and First National Bank, Rosedale, MS. The Administration and bank experts expect the cost of bank closures of FDIC insured institutions will cost $100 billion between the last quarter of 2009 and 2013.

Douglas A. McIntyre