WASHINGTON — The toll of failed banks is mounting, with 77 institutions closed by regulators so far this year — the most since 1992 at the height of the savings-and-loan crisis.
In contrast with the big bank failures early in the financial crisis, many of the recently shut banks were undone not by exotic mortgage products but by garden-variety loans.
At the same time, a knot of big, complex banks collapsing in recent months is sapping billions from the federal deposit insurance fund that insures regular accounts up to $250,000, spurring regulators to court potential buyers from the world of private investment.
The Federal Deposit Insurance Corp. last week seized Colonial BancGroup Inc., a big lender in real estate development, and sold its $20 billion in deposits, 346 branches in five states and about $22 billion of its assets to BB&T Corp.
It was the biggest bank failure so far this year, and the sixth-largest in U.S. history, expected to cost the insurance fund $2.8 billion. The Associated Press
