The FDIC, which has seen nearly 100 banks fail during 2011, is projecting that figure may rise again in 2012.
Nevertheless, it is in the process of eliminating some 500 “failure-related” positions for 2012 as it reduces its overall budget by 15%.
“I don't think we're in a position to relax,” Martin Gruenberg, the FDIC's acting chairman and now awaiting confirmation for the permanent job, told American Banker, an affiliate of National Mortgage News. “We're still dealing with a very challenging environment with large numbers of problem banks, and although failing banks are declining significantly, we're still anticipating in the coming year a significant number.”
The FDIC has overseen 92 bank failures in 2011, and has indicated that figure may rise next year. However, it is now adding positions dedicated to helping the FDIC implement all of its responsibilities under the Dodd-Frank Act.
“The FDIC is moving away from the liquidation and resolution process because the industry is becoming a little healthier,” but “they view their recent experience partly as a lesson that they should have a bigger role on the front end,” Dwight Smith, a partner at Morrison & Foerster, told American Banker.
The year's 92 FDIC takeovers were a 41% drop from 2010, the peak year for failures stemming from the 2008 crisis. And though failures in all of the past four years – a period that has seen 414 seizures – typically have involved small institutions, only one failure in 2011 involved an institution with assets of more than $2 billion, American Banker reported.
Credit unions have seen 15 failures to date.
