FDIC Boosts 2010 Budget, Staff as Bank Failures Rise

[The Northerner]

Dec. 15 (Bloomberg) -- The Federal Deposit Insurance Corp., overseeing the dissolution of failed banks at the fastest pace in 17 years, today boosted its 2010 budget 56 percent to $4 billion to manage further shutdowns.

The total budget will increase from $2.6 billion and the budget for handling bank failures doubles to $2.5 billion from $1.3 billion this year, according to a budget proposal the FDIC board approved in Washington. The agency staff will increase to 8,653 next year from 7,010 for this year.

The budget “will ensure that we are prepared to handle an ever-larger number of bank failures next year, if that becomes necessary, and to provide regulatory oversight for an even larger number of troubled institutions,” FDIC Chairman Sheila Bair said in a statement.

Bank failures have climbed to 133 this year, the most since 1992, as soured commercial-real estate loans and mortgage defaults hobbled U.S. lenders. The agency has hired staff to handle the surge, which pushed the deposit insurance fund to an $8.2 billion deficit in the third quarter.

The additional 1,643 FDIC staff will include 1,559 temporary workers and 84 permanent employees, with a majority of positions added to the division that handles bank failures.

“What we’re dealing with here, in effect, is an emergency response to the crisis,” FDIC Vice Chairman Martin Gruenberg said during discussion about hiring of temporary staff scheduled next year.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=arQEV.zQ0wMY

[Peace4us]

1. Isn't the Recession Over

Bank failures? But I thought the recession was all over. Oh, I see. Just little independent banks will fail. Those that had taxpayer money to gamble in the stock market will be just fine. Whew, much better now.

[OnceUponTimeOnTheNet]

2. MSNBC has a new report out on Banks, it's interesting...

Is your bank in trouble? More report bad loans

The number of banks with risky levels of bad loans continues to climb rapidly, particularly in the West and Southeast, according to federal data analyzed by msnbc.com and the Investigative Reporting Workshop at American University in Washington.

A total of 369 banks had high “troubled asset ratios” at the end of September, up from 297 in June, an increase of one-fourth, according to the analysis. A high ratio means a bank had more troubled loans than money set aside to cover potential losses.

The states with the heaviest concentrations of banks with high levels of bad loans are Nevada, Washington, Florida, Arizona, Georgia, Oregon and Utah


more:
http://www.msnbc.msn.com/id/34320344/ns/business-us_business/

[OnceUponTimeOnTheNet]

3. And a Kick to Rec. I like your posts Northerner.

Welcome to DU.

[notesdev]

4. Me too

More people ought to pay attention to what is going on in the economy - it's where the real action is.