The American banking sector continues to grapple with failures and on an average, ten banks are closing down every month. This year, 30 banks have already collapsed and the numbers are expected to rise in the coming weeks. A staggering 184 banks have folded up since the bankruptcy of the then Wall Street major Lehman Brothers in September 2008.
Going by the official data, four entities were shut down by the authorities last week. Park Avenue Bank, Statewide Bank and Old Southern Bank failed on March 12 while LibertyPointe Bank collapsed on March 11. The Federal Deposit Insurance Corporation (FDIC), which insures deposits at over 8,000 American banks, said these four failures would cost the agency USD 208.2 million.
Small and medium banks are hit the most, since high unemployment levels are resulting in rising defaults. Despite a shaky labour market, the US economy has been growing at a healthy pace in the past few quarters. Eight banks have gone belly up so far in March. Last month, seven entities failed while the count of collapses stood at 15.