by Calculated Risk on 7/30/2023 08:21:00 AM

The Heartland Tri-State Bank was closed on Friday, but wasn't on the unofficial list.

The FDIC's official problem bank list is comprised of banks with a CAMELS rating of 4 or 5, and the list is not made public (just the number of banks and assets every quarter). Note: Bank CAMELS ratings are also not made public.

CAMELS is the FDIC rating system, and stands for Capital adequacy, Asset quality, Management, Earnings, Liquidity and Sensitivity to market risk. The scale is from 1 to 5, with 1 being the strongest.

As a substitute for the CAMELS ratings, surferdude808 is using publicly announced formal enforcement actions, and also media reports and company announcements that suggest to us an enforcement action is likely, to compile a list of possible problem banks in the public interest.

DISCLAIMER: This is an unofficial list, the information is from public sources only, and while deemed to be reliable is not guaranteed. No warranty or representation, expressed or implied, is made as to the accuracy of the information contained herein and same is subject to errors and omissions. This is not intended as investment advice. Please contact CR with any errors.

NOTE: I'm no longer updating the spreadsheet.

Here are the quarterly changes and a few comments from surferdude808:

Update on the Unofficial Problem Bank List through June 30, 2023. Since the last update at the end of March 2023, the list increased by one to 47 institutions after three additions and two removals. Assets increased by $5.7 billion to $55 billion, overcoming a $3.1 billion decrease from updated asset figures through March 31, 2023. A year ago, the list held 54 institutions with assets of $54.4 billion. Additions include Cross River Bank, Teaneck, NJ ($8.5 billion); The Idabel National Bank, Idabel, OK ($292 million); and Du Quoin State Bank, Du Quoin, IL ($137 million). Removals were United Trust Bank, Palos Heights, IL ($143 million) and Wabash Savings Bank, Mount Carmel, IL ($9.6 million).

With the conclusion of the second quarter, we bring an updated transition matrix to detail how banks are transitioning off the Unofficial Problem Bank List. Since we first published the Unofficial Problem Bank List on August 7, 2009 with 389 institutions, 1,784 institutions have appeared on a weekly or monthly list since then. Only 2.6 percent of the banks that have appeared on a list remain today as 1,745 institutions have transitioned through the list. Departure methods include 1,032 action terminations, 411 failures, 283 mergers, and 19 voluntary liquidations. Of the 389 institutions on the first published list, only 3 or less than 1.0 percent, still have a troubled designation more than ten years later. The 411 failures represent nearly 23 percent of the 1,792 institutions that have made an appearance on the list. This failure rate is well above the 10-12 percent rate frequently cited in media reports on the failure rate of banks on the FDIC's official list.

On May 31, 2023, the FDIC released first quarter results and provided an update on the Official Problem Bank List. While FDIC did not make a comment within its press release on the Official Problem Bank List, they provided aggregate totals of 43 institutions with assets of $58 billion.