Two more banks in the USA have been shut down by the federal regulator bringing the total number of failed banks to 94.
The Federal Deposit Insurance Corporation (FDIC) which monitors the banking sector has closed down Irwin Union Bank & Trust and Irwin Union Bank. This is because their parent company was unable to fulfill the FDIC's demands to increase its capital. The failure of these two banks is likely to cost in the region of $800-850m. This will come from the FDIC's insurance fund whose reserves have gone from $45 billion to just over $10 bn due to the amount of failures that have taken place. Despite the worries that the FDIC reserves will run dry, they have assured analysts that they have over $40 bn, enough to cover any more failures over the next year or so.
First Financial Bank, Irwin Union Bank & Trust and Irwin Union Bank's rival will take over their accounts.