On average, between 1980 and 1994, a US bank failed every three days. The pace of bankruptcies peaked immediately after the 2008 financial crisis. The 2008 financial crisis led to many bank failures in the United States. The Federal Deposit Insurance Corporation (FDIC) closed 465 failed banks from 2008 to 2012. In contrast, in the five years prior to 2008, only 10 banks failed. At the end of 2022, the US banking industry had a total of about $620 billion in unrealized losses as a result of investments weakened by rising interest rates.
A bank failure is the closing of a bank by a federal or state banking regulatory agency. The FDIC is named as receiver for a bank's assets when its capital levels are too low, or it cannot meet obligations the next day. After a bank's assets are placed into receivership, the FDIC acts in two capacities—first, it pays insurance to the depositors, up to the deposit insurance limit, for assets not sold to another bank. Second, as the receiver of the failed bank, it assumes the task of selling and collecting the assets of the failed bank and settling its debts, including claims for deposits in excess of the insured limit. The FDIC insures up to $250,000 per depositor, per insured bank, as a result of the Emergency Economic Stabilization Act of 2008, which raised the limit from $100,000.
The receivership of Washington Mutual Bank by federal regulators on September 26, 2008, was the largest bank failure in U.S. history. Regulators simultaneously brokered the sale of most of the banks's assets to JPMorgan Chase, which planned to write down the value of Washington Mutual's loans at least $31 billion.
2008 Twenty-five (twenty-six including the Utah-based wholly owned subsidiary of Washington Mutual, which was covered under the same FDIC closure notice as its parent company) banks failed in 2008 Bank City State Date Acquired by Assets ($mil.) 1 Douglass National Bank Kansas City Missouri Liberty Bank and Trust 58.5 2 Hume Bank Hume Missouri Security Bank 18.7 3 Bear Stearns New York City New York J.P. Morgan Chase 395,000 4 ANB Financial N.A. Bentonville Arkansas Pulaski Bank and Trust Company 2,100 5 First Integrity Bank, N.A. Staples Minnesota First International Bank and Trust 54.7 6 IndyMac Pasadena California OneWest Bank, FSB 32,000 7 First National Bank of Nevada Reno Nevada Mutual of Omaha Bank 3,400 8 First Heritage Bank, N.A. Newport Beach California Mutual of Omaha Bank 254 9 First Priority Bank Bradenton Florida SunTrust Banks 259 10 The Columbian Bank and Trust Company Topeka Kansas Citizens Bank and Trust 752 11 Integrity Bank Alpharetta Georgia Regions Bank 1,100 12 Silver State Bank Henderson Nevada Nevada State Bank 2,000 13 Ameribank Northfork West Virginia The Citizens Savings BankPioneer Community Bank 113 14 Washington Mutual Bank Seattle Washington JPMorgan Chase & Co 307,000 15 Main Street Bank Northville Michigan Monroe Bank and Trust 98 16 Meridian Bank Eldred Illinois National Bank 39.2 17 Alpha Bank & Trust Alpharetta Georgia Stearns Bank, N.A. 354.1 18 Freedom Bank Bradenton Florida Fifth Third Bank 287 19 Franklin Bank Houston Texas Prosperity Bank 5,100 20 Security Pacific Bank Los Angeles California Pacific Western Bank 561.1 21 The Community Bank Loganville Georgia Bank of Essex 681.0 22 Downey Savings and Loan Newport Beach California U.S. Bank, N.A. 12,800 23 PFF Bank and Trust Pomona California U.S. Bank, N.A. 3,700 24 First Georgia Community Bank Jackson Georgia United Bank 237.5 25 Haven Trust Bank Duluth Georgia Branch Banking and Trust Company (BB&T) 572 26 Sanderson State Bank Sanderson Texas The Pecos County State Bank 37
2009 One hundred forty banks failed in 2009