Report: U.S. expects more bank failures

New York -- U.S. regulators anticipate as many as 150 of the nation's 7,500 banks could fail during the coming year, The New York Times reported Monday.

Although analysts say banks are not in as much danger as they were following the savings-and-loan scandal of the late 1980s and early '90s, declining housing prices and growing loan defaults are contributing to rapidly growing problems for banks, the newspaper said.

The U.S. government Friday took over IndyMac Bank, with federal regulators calling the bank's failure the second-largest in U.S. history. The Office of Thrift Supervision said it transferred control of the bank to the Federal Deposit Insurance Corp., which planned to the $32 billion bank Monday.

Wall Street analysts are now wondering how many more banks might fail and which one might be next, the Times said.

While banking analysts say as many as 150 small and mid-size banks might fail during the next 12 to 18 months, others are likely to close branches or try to arrange mergers, the report said.

The U.S. Treasury said Sunday it would seek congressional approval of a plan to bail out Fannie Mae and Freddie Mac, following a week in which the mortgage lenders' stock prices fell 45 percent.

Copyright 2008 by United Press International.