The US banking system saw a total of 25 bank closures in the year 2008, while the number jumped up five fold to over 125 banks in the next year 2009.
Now as of last week end, over 100 banks have closed down in the year 2010 , due to the increasing bad debts write off.
The US banking system has poured trillions of dollars into the hands of it’s citizens through various loans including mortgage loans, personal loans, car loans, credit card loans etc.,
The unemployment level continues to be near the 10% level officially, while unofficial rate of unemployment could be well beyond 15%, say experts.
There are more number of houses on sale in the market, that have been seized by banks due to defaults by customers. Thus there is not likely to be a major improvement in the housing prices in the next few quarters. The housing credit scheme seems to be fading off and there could be lesser takers for the scheme in the coming months.
The European crisis is only expected to force many US banks to avoid lending further to European system, which means lesser income prospects in the next term.
And the US government has already passed a legislation to stop any further government funding for banking bailouts. So expect more trouble for the US banking system in the next two quarters, and subsequent performance would totally depend on the global economic recovery.