First failure of an FDIC-insured bank since 2004 happened today

[w¡n9Nµ7 §£@¥€r 123]

Bank regulators have closed Metropolitan Savings Bank of Pittsburgh and approved the takeover of its insured deposits by another Pittsburgh bank, the Federal Deposit Insurance Corp. announced Friday.

The closing of Metropolitan Savings, a bank with just one office and some $15.8 million in assets as of last September, marked the first failure of a federally insured financial institution since June 2004. It was closed by the Pennsylvania Department of Banking and the FDIC was named receiver.

[...]

There are about $1.2 million in deposits in 70 Metropolitan accounts that appear to exceed the deposit insurance limit of $100,000, the FDIC said in a news release.

All depositors will continue to have immediate access to their insured funds, the agency said.

The previous such failure, in June 2004, was that of the Bank of Ephraim in Utah. There have been no major U.S. bank failures since the collapse of Superior Bank, a $1.8 billion savings and loan in the Chicago area, in July 2001.

http://www.examiner.com/a-544383~Regulator...Pittsburgh.html

[William33 110]

Bank Regulators = The Federal Reserve Banks

Good call.

[kitkat1 5]

What does that mean exactly? Why did they fail? Because they exceeded the federal deposit insurance limit? I don't get i!

[Hilarious Clinton 452]

Banks are a business and can be run into the ground like any other business.

[w¡n9Nµ7 §£@¥€r 123]

Why did they fail?

If you'd like a thorough answer to that question, read this document - http://www.bis.org/publ/bcbs_wp13.pdf.

[rebeccajo 14]

There was a statewide institution here shut down by the FDIC in the 90's. Padlocks, chains and all.

Open for business the next day and nothing changed for the customers.

[w¡n9Nµ7 §£@¥€r 123]

... and nothing changed for the customers.

Except for the customers with deposits that exceeded the FDIC-insurable amounts, I'm sure.

[rebeccajo 14]

... and nothing changed for the customers.

Except for the customers with deposits that exceeded the FDIC-insurable amounts, I'm sure.

Sure. If there were any.

I used to work there. The Customer Service Reps keep that in check by advising customers on how to open accounts.

[Caladan 19]

According to the article it seems that a bank fails once every two years. There's no reason to believe that the trend is accelerating, but if you have $100,000; maybe split it into two accounts or invest some of it?

[w¡n9Nµ7 §£@¥€r 123]

According to the article it seems that a bank fails once every two years.

I didn't get that from the article. In any event, that isn't true. Bank failures tend to 'cluster' around each other.