by Calculated Risk on 7/01/2018 01:05:00 PM

Note: Surferdude808 compiles an unofficial list of Problem Banks compiled only from public sources.

Here is the unofficial problem bank list for June 2018.

Here are the monthly changes and a few comments from surferdude808:

Update on the Unofficial Problem Bank List for June 2018. During the month, the list count was unchanged on a net basis after one removal and one addition. However, assets increased by a substantial $42.0 billion during the month to $60.0 billion. A year ago, the list held 137 institutions with assets of $35.2 billion.

This month, the action against Legacy State Bank, Loganville, GA ($92 million) was terminated.

The large jump in assets this month results from the addition of Deutsche Bank Trust Company Americas, New York, NY ($42.1 billion) to the list. In our last post on the list at the end of May, we noted the large increase in assets on the FDIC’s Official Problem Bank List they disclosed on May25th. At that time we suspected the large increase resulted from the FDIC adding a domestically charted bank with foreign ownership. A few days after our post, several major media outlets confirmed our suspicions. Interestingly, however, is that the Federal Reserve issued the enforcement action to Deutsche Bank Trust Company Americas back in May 2017. It makes us wonder why the bank did not make it onto FDIC’s official list until March 2018.

With it being the end of the second quarter, we bring an updated transition matrix to detail how banks are moving off the Unofficial Problem Bank List. Since the Unofficial Problem Bank List was first published on August 7, 2009 with 389 institutions, a total of 1,731 institutions have appeared on a weekly or monthly list at some point. Only 5.3 percent of the banks that have appeared on a list remain today. In all, there have been 1,639 institutions that have transitioned through the list. Departure methods include 960 action terminations, 406 failures, 256 mergers, and 17 voluntary liquidations. Of the 389 institutions on the first published list, only 9 or 2.3 percent still remain in a designated troubled status more than eight years later. The 406 failures represent 23.5 percent of the 1,731 institutions that have made an appearance on the list. This failure rate is well above the 10-12 percent rate frequently cited in media reports on the failure rate of banks on the FDIC's official list.

Unofficial Problem Bank List
Change Summary
		Number of Institutions	Assets ($Thousands)
Start (8/7/2009)		389	276,313,429
Subtractions
	Action Terminated	178	(65,500,762)
	Unassisted Merger	40	(9,818,439)
	Voluntary Liquidation	4	(10,584,114)
	Failures	158	(186,397,337)
	Asset Change		(449,522)
Still on List at 6/30/2018		9	3,563,255
Additions after 8/7/2009		83	56,456,770
End (6/30/2018)		92	60,020,025
Intraperiod Removals1
	Action Terminated	782	320,707,101
	Unassisted Merger	216	82,115,858
	Voluntary Liquidation	13	2,515,855
	Failures	248	125,152,210
	Total	1,259	530,491,024
1Institution not on 8/7/2009 or 6/30/2018 list but appeared on a weekly list.