Banks to Post a Rare Quarterly Loss; First Red-Ink Period Since '90 Is Likely For U.S. Lenders

The Wall Street Journal ^ | 2008-12-30 | Robin Sidel

[rabscuttle385]

Banks and savings institutions in the U.S. appear headed for their first overall quarterly loss since 1990, as troubled loans pile up faster than the federal government's unprecedented efforts to aid the battered industry.

Since posting combined profit of $1.7 billion in the third quarter, already a 94% plunge from a year earlier, life has gotten even worse for the roughly 8,300 financial institutions with deposits backed by the Federal Deposit Insurance Corp. Rising unemployment is causing more agony from old problems such as shaky mortgages and credit cards, and losses now are spreading to commercial real-estate loans.

[rabscuttle385]

*Ping!*

[rabscuttle385]

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[TigerLikesRooster]

Zombie banks to be on perpetual life support by Fed?

[rabscuttle385]

Zombie banks to be on perpetual life support by Fed?

Pretty much!

[Opinionated Blowhard]

And the people who caused this rare disaster still have their multi-million dollar bonuses.

[wmfights]

It's surprising how quickly this is spreading throughout the economy. I am in the RE business operating apt bldgs. Usually this time of year we don't get applications from higher caliber tenants. However, it's even worse. We've gotten several calls from people who have been foreclosed on and I have yet to see a credit score over 585.

These applicants are clueless when we ask them what guarantees they can offer that the rent will be paid.

If this continues into the spring we might have to start taking these people.

[TheZMan]

Good. I’m tired of every other building in town being a bank. It (was) apparently a very profitable business to be in since every one of those bank buildings were in the $500k (and much...much more) price range.

[webheart]

Frikkin banks make all their money on overdraft charges. Look for them to increase to 50 dollars per.