Banking Industry Posts First Loss Since 1990, FDIC Says

The Federal Deposit Insurance Corporation (FDIC) announced the first quarterly loss in U.S. banks since 1990 in the fourth quarter.

Although the FDIC does not name the banks, they said, in total, U.S. banks lost 26.2 billion in Q4. In 1990, losses totalled $2.3 billion.

"There is no question that this is one of the most difficult situations that we have encountered during the FDIC's 75 years of operation," said Sheila Bair, chairwoman of the FDIC.

The FDIC said the number of "problem" banks in the United States rose to 252 from 171. It also said its reserves dropped by 45%.

By Megan Ainscow and edited by Sarah Sussman
©CEP News Ltd. 2009