75 Days, 30 Bank Failures

Another New York bank was closed this week, as well. LibertyPointe, which tended to service the Orthodox Jewish community in Manhattan and Brooklyn, was shut down by the FDIC, and Valley National is assuming its assets and deposits, as well.

Old Southern Bank in Florida was shut down by the FDIC. Centennial Bank agreed to pay a premium for its $319.7 million in deposits and assume basically all of its $315.6 million in assets. And when the FDIC closed Statewide Bank in Louisiana, Home Bank agreed to acquire its $243.2 million in assets and $208.8 million in deposits -- but it won't pay a premium.

Park Avenue Bank is expected to cost the FDIC's insurance fund $50.7 million, with Old Southern chewing up another $94.6 million and Statewide $38.1 million. And, there's more to come. The pace is expected to accelerate in the next few months, according to the FDIC. The deposit insurance fund was $20.9 billion in the red at he and of last year, when the number of banks on the FDIC's confidential "problem" list surged to 702.

Last year, 140 banks failed, the highest number since 1992, and it cost the FDIC insurance fund $30 billion. In 2008, only 25 banks failed. In 2007, the result was a miniscule three.

If the trend is linear, 146 banks will fail this year, topping even the significant level seen last year. Given that the FDIC sees the pace quickening, 2010 could be a long year for the community banking sector.