FDIC reports another bank closing, but it's actually part of the good news

The FDIC announced last week the takeover of a Fort Myers, Florida bank.  It was the third takeover of a Florida bank this year.  But that's good news.

U.S. bank failures have been declining since they peaked in 2010 in the wake of the financial crisis and the Great Recession.

 In 2007, only three banks went under. That number jumped to 25 in 2008, after the financial meltdown, and ballooned to 140 in 2009.

 In 2010, regulators seized 157 banks, the most in any year since the savings and loan crisis two decades ago. The FDIC has said 2010 likely was the high-water mark for bank failures from the recession. They declined to a total of 92 in 2011.

 Last year, bank failures slowed to 51 — still more than normal. In a strong economy, an average of only four or five banks close annually.

 The sharply reduced pace of bank closings shows sustained improvement.

I know, I know, closing a bank shows improvement?  Yes, it does in this case because the FDIC fund that is used to back-up depositors in these cases is in the black and the fund balance is expected to increase greatly over the next few years.

Want to learn more, read the full article.

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