In Other News: Three More Banks Go Down
Another one of those stories that would normally be front page news for a week but barely registers these days:
Two California thrifts (Downey Savings & Loan and PFF Bank & Trust) and one Georgia thrift (Community Bank of Loganville) were closed by regulators on Friday, the highest number of bank closures in a single day since the S&L crisis of the late 1980s.
All the banks were put into receivership by the FDIC which then sold all the deposits. Bo depositors lost money, however the FDIC deposit insurance fund is on the hook for an estimated $2.3 billion total for all three banks.
So far this year, 22 U.S. banks have failed, the largest being the $307 billion Washington Mutual. All the banks failed due to massive lending in the sub-prime mortgage sector that have since gone sour.