Washington State Banks Straining Under the Weight of the Crisis

Ailing financial giants such as Citigroup (C), Bank of America (BAC) and AIG (AIG) have drawn most of the attention as the worst banking crisis since the Great Depression grinds on.

But several of Washington’s community banks also are clearly straining under the weight of the crisis, a Seattle Times analysis shows. At least a dozen of the 52 Washington-based banks examined are carrying heavy loads of past-due loans, defaults and foreclosed properties relative to their financial resources.

Many of these banks troubles….”are tied directly to their heavy dependence on real-estate loans — mainly loans to local builders and developers” and they “have set aside relatively little cash to cover problem loans, the analysis shows.”

Overall, however…..Northwest banks are in better shape than banks in the West’s hottest housing markets: California’s Central Valley and Inland Empire regions, Las Vegas and Arizona. [The Seattle Times]

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