Report: Hundreds of U.S. banks at risk of failure in high-rate environment
Hundreds of U.S. banks are at risk of failure following several high-profile bank failures in 2023 and the collapse of Republic First bank in Philadelphia last week, according to an analysis by Klaros Group. The study shows that small and regional banks are under pressure due to overburdened commercial real estate loans and the current high-rate environment. Among more than 4,000 financial institutions in the United States, 282 are under pressure. "Most of these banks are not insolvent or even close to being insolvent," said Brian Graham, co-founder and partner of Klaros Group. "They are just too stressed and may not really fail in so many ways. But that doesn't mean that communities and consumers won't be hurt by this stress."