Printer Friendly

Veribanc study finds FDIC insolvent.

An independent study of 1990 year end data for the nation's 12,795 commercial and savings banks conducted by Veribanc, a bank rating service, has confirmed the General Accounting Office's earlier finding that the Federal Deposit Insurance Fund is insolvent. Veribanc estimates the shortfall at $3.6 to $7.6 billion if banks with assets of more than $1.0 billion are considered, and somewhat more if smaller banks are also included.

If domestic and overseas problem loans were charged off and other real estate assets were liquidated at 50 cents on the dollar for banks with assets of $1.0 billion or more, 29 of these large banks would become insolvent according to Veribanc, with bailout costs estimated at $11.6 billion. This compares with an estimated current FDIC value of $4 to $8 billion.
COPYRIGHT 1991 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Journal of Accountancy
Date:Jul 1, 1991
Previous Article:Rostenkowski to introduce tax simplification bill.
Next Article:AICPA says loan splitting does not conform with GAAP.

Related Articles
Statement to Congress.
The 100 grand illusion; the problem with the banks and thrifts that they still haven't fixed.
Rising bank deposit insurance rates to have little impact.
Thrifts record lower losses in early 1991.
Financial institutions continue to improve.

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters