NEW YORK ( TheStreet) -- Between mid-2006 through the end of 2008, I wrote many pieces that warned investors to avoid community banks. This followed my prediction that many community banks would fall like dominoes in the failure process conducted by the FDIC.
In the December 2008 article I wrote for Equities magazine, I profiled 12 community banks that I thought would fail before the Great Credit Crunch came to an end. Seven failed, four survived and one is no longer publicly traded.
In 2008, the FDIC closed only 25 banks via the failure procedures. In 2009, the floodgates of failure opened with 140 bank failures. The peak year was 2010, with 157 failures. Today the total for the Great Credit Crunch is 481 bank failures, on the way to my predicted 500.Here is a copy of the table I used for that December 2008 article: Courtesy of FDIC and Equities.com These community banks were on my endangered species list because they had strong sell or sell ratings according to ValuEngine, and because they had a Construction and Development Loan to Risk Based Capital ratio above 100%, which was the regulatory guideline. Here are my buy-and-trade profiles for the four survivors:
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