Although there have been 92 bank closures overseen by the Federal Deposit Insurance Corp. (FDIC) so far this year, no Wisconsin-based banks have been ordered closed by federal officials.
However, the number of closed banks in states surrounding Wisconsin continues to climb. On Friday, federal officials ordered Chicago-based Corus Bank, National Association, to close. The bank has been purchased by MB Financial Bank, also of Chicago.
Corus Bank was the 16th Illinois-based bank that has been seized by the FDIC this year. Three banks have closed in Minnesota this year, and one bank has closed in both Michigan and Iowa.
While banks in neighboring states have increasingly been ordered shut by federal regulators, Wisconsin’s banking industry has not yet because of a more conservative business culture, said Rose Oswald Poels, senior vice president and counsel of the Wisconsin Bankers Association.
“We do enjoy a rather stable economy here, despite the roller coaster we’re on now, when you look at the rest of the country,” she said. “Our bankers are relatively conservative as a whole. I think our conservative lending practices are boding well for us and are why wer have not seen a failure (in Wisconsin) yet.”
About 82 percent of Wisconsin’s banks posted a profit during the second quarter of 2009, slightly more than the national rate of 74 percent.
According to the latest state profile compiled by the FDIC, Wisconsin has 282 financial institutions based in the state, a decrease from 290 in the second quarter of 2008. The state’s banks have a total of $157.5 billion in assets, compared to $158.9 billion about one year ago.
The banking industry is one of the last industries that will rebound as the recession ends, Oswald Poels said. The higher-than-average rate of bank closures will likely remain through the end of 2010, she said.
“I think it’s impossible to predict (when or if a Wisconsin bank will be ordered to close),” she said. “Our banks are not immune (to this economy). But on balance, they are strong and profitable and are able to withstand the issues that the recession has presented.”