DEFINITION of ‘FDIC Problem Bank List’
The FDIC problem bank list is a confidential list of troubled banks and thrifts in the U.S. published by the Federal Deposit Insurance Corporation (FDIC) every quarter. It does, however, publish how many institutions are on the list as part of its wider banking survey.
BREAKING DOWN ‘FDIC Problem Bank List’
To make the FDIC problem bank list, a bank must have financial, managerial or operational weaknesses that threaten its continued financial viability. Because making this information public might start runs on banks, the names of the banks are withheld from the list.
The list does include data for net interest margins, net income and net trading revenue. It also includes data on lending levels (outstanding loans) and asset quality — such as the level of nonperforming assets, net charge-offs (actual loan losses), and loan loss provisions.
Only institutions that are insured by the FDIC through the Deposit Insurance Fund are on the list. If problems continue with a listed bank, the FDIC takes control of it, before selling it to a stronger bank, or liquidating it and refunding the depositors.
At the peak of the financial crisis in 2009, there were 900 troubled institutions on the problem bank list, the highest level since 1993. By 2018, this had fallen below 100.