- Buffett's Berkshire Hathaway Boosts Stake in Wal-Mart
- Time Warner to Spin Off AOL on December 9
- Gates Boosts Waste Management, Coca Cola Stakes
- What's Kept Stock Rally Going? Fear, Not Confidence
- Fed to Keep Rates Low Despite Dollar's Fall: Bernanke
- Citi Shares, A Strange Indicator Of Unemployment?
- Millions Could Have to Repay Part of Obama's Tax Credit
- Hollywood Turns to Porn as Unemployment Rises
- Slideshow: US Cities With Most Underwater Mortgages
- Answers to Your Questions: A Path to Economic Disaster?
- 5 Ways to Play the Chinese Markets: Analyst
- Meredith Whitney: Turns Bearish
- 3 Stock Plays on Rising College Costs
- Warren Buffett's Berkshire Hathaway Almost Doubles Wal-Mart Holdings During Summer
- Nov. 16: Unusual Volume Leaders
- Getting to the Heart of the Merck-Abbott Embargo Break
- What MGM's Sale Could Say About Value of Content
- My Ratings on Lowe's & Home Depot: Analyst
MOST SHARED
- Stocks Overvalued, Recession Will Return: Meredith Whitney
- U.S. May Wind Up Green With Envy
- Has Twitter's Finest Hours (Seconds) Come and Gone?
- BofA Ex-Counsel: I Was 'Stunned' When I Got Fired
- Solar Emerges From A Dark Period
- Bernanke Offers Something For Everyone
- CNBC Video: Warren Buffett & Bill Gates - Keeping American Great
- Millions May Have to Repay Part of Obama Tax Credit
- Stanford Receiver to Release Funds Of Frozen Acounts
- Warren Buffett's Berkshire Hathaway Almost Doubles Wal-Mart Holdings During Summer
Text Size 
The Federal Deposit Insurance Corp.'s (FDIC) list of troubled banks has increased by 30 percent this quarter, and this jump is causing the FDIC and the banking community to prepare for tomorrow’s problems today.
The FDIC may have to borrow money from the Treasury Department to handle an expected wave of bank failures coming down the road, according to the Wall Street Journal.
It would not be surprising if this were to occur, according to Chris Whalen, managing director of Institutional Risk Analytics. In an interview with CNBC, Whalen said the FDIC needs a backstop. (To listen to the full interview, watch the video.)
"They need about a half a trillion dollars in borrowing authority, and they need a vehicle to own these banks while we triage them and sell them."
Whalen added that he expects big bank failures might be on the way.
"It depends on the loss rate," he said. "If we are way over 1990s levels, by say the third quarter, then I would tell you there’s going to be some institutions that may not be able to raise private capital and may need a bridge."
The discussion was prompted by an announcement Tuesday by the FDIC that it was increasing the number of banks on its watch list to 117, up from 90 in the first quarter.
“We don’t think this credit cycle has bottomed out yet,” said FDIC Chairman Sheila Bair at a press conference Tuesday. “I don’t like to make predictions, but I think it’s going to continue to be very challenging, and as I said I think the number of banks and assets on the troubled bank list will continue to go up.”
- FDIC May Borrow Money From Treasury: Report
- FDIC: Troubled Banks Rise to 117, Most in Five Years
- Cramer: Don't Buy These Banks
Print
Email
- Where, what, how.
- CNBC's Jim Goldman asks: Has the sun begun to set on Twitter? Data suggests its best days are over.
- Everyone wanted a piece of Madoff's "Bullship"--the famous buoy sold for $7,500 at auction. You won't believe these prices.
- De Loach Vineyards is selling its pinot noir the old fashioned way, helping to cut energy and transportation costs.
- Why are the Chinese concerned about the progress of U.S. health care legislation?
- CNBC's Maria Bartiromo talks to rapper Snoop Dogg about brand identity in both business and music.
Data is a real-time snapshot *Data is delayed at least 15 minutes