PALM BEACH GARDENS, Fla.–An independent ratings agency has issued a statement warning that as many as 4,243 financial institutions, including credit unions, “could be vulnerable to failure.”
Weiss Ratings said that of the financial institutions in the U.S., 1,210 institutions (or 12.8%) got a “red warning flag,” which it said signaled risk of imminent failure, while 3,043 received a yellow warning flag, indicating risk of failure in a financial crisis or recession.
In sum, 45% of all banks and credit unions were deemed “vulnerable,” the company said.
99% Prediction Rate
"Since 2008, among the 539 banks that have failed, Weiss Ratings has provided advance warning on 535, or 99.3%,” said COO Dallas Brown. “The underlying financial weaknesses in the U.S. banking industry are widespread, and the FDIC's newly expanded guarantee of all deposits does nothing to protect shareholders in bank holding companies, who could still lose most or all of their money. Moreover, if the U.S. Treasury cannot even pay its own bills, it could be hard-pressed to cover the expanded liabilities of the FDIC."
Weiss Ratings publishes its data here.
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