Seven more US banks go belly up;'09 failures tally touches 140

Seven more US banks go belly up;'09 failures tally touches 140

As many as 12 banks are going out of business every month in the financial crisis-ravaged economy.

Reflecting the troubles for the nation's banking sector, the count of failures this year is already more than five-fold that of 2008, when just 25 banks folded up.

Last Friday, the authorities closed down seven entities -- First Federal Bank of California, Imperial Capital Bank, Independent Bankers' Bank, New South Federal Savings Bank, Citizens State Bank, Peoples First Community Bank and RockBridge Commercial Bank.

The Federal Deposit Insurance Corporation (FDIC), which guarantees deposits of over 8,000 US banks, has said the seven failures would cost the agency USD 1.8 billion.

Medium and small banks are the worst hit by the crisis, with high unemployment levels resulting in increased defaults.

So far this month, 16 banks have been shuttered, including one of the biggest entities -- AmTrust Bank.

The bank collapses in 2009 is the highest in 18 years. A staggering 181 banks were shut down in 1992 due to the savings and loan crisis.

A whopping 155 banks have bite the dust since the famed Lehman Brothers went bankrupt in September 2008.

The pace of job losses coupled with better GDP figures in recent months, have indicated that the US economy is improving.

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