Monday, July 9, 2012

The Decline of Financial Failure

As has frequently been the case in recent years, Friday was the night the lights went out for a bank in Georgia. This time it was Montgomery Bank and Trust, a two-branch bank with $174 million in assets. The bank failed and was taken over by America Bank.
Friday, July 6, was the first Friday in three weeks that a bank failed. The time off from chronicling the woes of the banking industry has given us a chance to step back and look at some trends in financial failure. For some time, it has been clear that, while pain persists in the credit markets — especially when it comes to housing — the rampant financial failure that crippled the system and the economy in 2008 and 2009 has been ebbing. As a general rule, people are doing a much better job keeping up on their financial obligations than they were a few years ago. Bankruptcy filings are down. In the first quarter of 2012, there were 332,973 filings in federal bankruptcy courts, a 12 percent decline from the 366,178 filings in the first quarter of 2011.
Real Signs of Improvement
That's not bad. But when it comes to keeping up with their credit card debt, American consumers have shown real signs of improvement. Cardhub.com aggregates data on credit card losses. Its most recent study shows that the delinquency rate on credit cards in the first quarter of 2012 fell to 3.11 percent, a sharp decline from 3.89 percent in the first quarter of 2011, and the lowest such total in the history of its time series, which goes back to 1991.

Read more: http://finance.yahoo.com/blogs/daniel-gross/georgia-bank-closes-financial-failure-declining-150441484.html

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