Here's a safe bet for uncertain times: A lot of banks won't survive the next year of upheaval despite the U. S. government's $700-billion plan to restore order to the financial industry.
The biggest question is how many will perish and how they will be put out of their misery -- in outright closures by regulators scrambling to preserve the dwindling deposit insurance fund or in fire sales made under government pressure.
Enfeebled by huge losses on risky home loans, the banking industry is now on the shakiest ground since the early 1990s, when more than 800 federally insured institutions failed in a three-year period.
That was during the cleanup phase of a decade-long savings-and-loan meltdown that wound up costing U. S. taxpayers $170 billion to $205 billion, after adjusting for inflation.
The government's commitment to spend up to $700 billion buying bad debts from ailing banks is likely to save some institutions that would have otherwise died, but analysts doubt it will be enough to avert a major shakeout.
Stanford Financial analyst Jaret Seiberg says it will help, but it's not going to be the saving grace.
He says that's because a lot of banks are holding construction loans and other types of deteriorating assets the government won't take off their books.
Seiberg expects more than 100 banks nationwide to fail next year.
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