US Banks continue to close at a faster pace : 103 banks closed so far in 2010

The global crisis is definitely slowing down or peaking which is indicated by the number of banks closing down in the US. In my view, the US will be the first to come out of this crisis since they have accepted the downfall and have come out with new regulations besides displaying transparency and were indeed the first to get into the crisis.

This year, in 2010, over 100 banks in the USA have been closed down by the regulators just in a span of 7 months. Total tally has reached 103 which is at a faster pace than in 2009 at the same time. It is estimated that at this pace, almost 250 banks may close down in the US. While in 2009, 140 banks had closed down and 25 in 2008 and only 3 in 2007.

In addition, US companies are shedding jobs at a very high rate. In all, approx 500,000 jobs are being lost each month. This number had risen to a high of 700,000 plus last year but has slowed down to half a million only. If we add at this rate for the past 3 years, we come to a number of 18 million net job losses in just 3 years.

Further, countries around the world which were unscathed are realising the impact of slowdown due to exports and joblessness among other factors. For example, China scaled down its GDP growth target from 10.5% for 2010 to 9.5% just last week.

With US sanctions taking affect on Iran in June, businesses in the Middle East that were supporting Iran by supplying goods, providing services such as finance and shipping have come to a grinding halt. It was announced yesterday, that several ships from Middle Eastern countries such as Lebanon and Turkey who were supplying oil and similar important raw materials have come under pressure not to work on shipping routes going to Iran with the fear of new sanctions.

Such isloated things like China, Iran etc are having further impact on the global slowdown.

While Canadian banks are involved in buying some of these closed banks and expanding their network. On the other side of the planet, down under, in Australia also the banks are expanding and buying networks of banks selling off their assets as such as RBS in Philippines and India. RBS also sold its existing branch operations in UAE (previously ABN AMRO Bank) to ADCB bank. This clearly indicates that all those banks that did not buckle under sub prime fallout nor displayed any tendencies to take unnecessary risks are now able to expand despite the global climate due to their own inherent strengths or of their economies.

We can see that not even one bank has been closed down in China (they continue to come out with bigger and more number of IPO's of banks), nor in India or Australia or Canada. Even most parts of Latin America are doing well.

The world is definitely shifting and the rules of capitalism are being rewritten.

It will be profitable for all those who embrace this change and can see the emergence of new trends, especially moving eastwards.

Jul 23, 10:26 PM EDT

US bank failures in 2010 surpass 100

By MARCY GORDON
AP Business Writer