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25 American banks fail in 2009

In a reflection of the worsening financial turmoil, a staggering 25 American banks have been shut down in less than four months this year, matching the total number of bank failures for the whole of 2008.

business Updated: Apr 19, 2009 11:03 IST

In a reflection of the worsening financial turmoil, a staggering 25 American banks have been shut down in less than four months this year, matching the total number of bank failures for the whole of 2008.

In 2008, the US saw failure of 25 banks, with most of the entities going bust after the current economic crisis turned severe in September last year.

The American government has so far this year closed 25 such entities, with ten banks going belly up in February alone. According to the Federal Deposit Insurance Corporation, which is often appointed as the receiver for failed banks, two banks, Great Basin Bank of Nevada, Elko and American Sterling Bank, Sugar Creek closed on April 17.

With four banks collapsing so far in April, the total number of such failures has touched 25 this year and the toll is expected to rise, as the economy is yet to show strong signs of recovery.

On April 10, the authorities had shut down New Frontier Bank, Greeley and Cape Fear Bank, Wilmington. A total of five six and five banks failed in January and March this year.

Nearly 40 banks have collapsed since the start of September last year, when the Wall Street giant Lehman Brothers filed for bankruptcy protection.