Figuring out how many banks have failed in the US in 2025 is a question on many people's minds, especially after the turmoil of recent years. In 2025, there have been a total of 2 bank failures in the United States, according to reports from the Federal Deposit Insurance Corporation (FDIC).

These failures are part of a broader trend that has seen 571 banks fail since January 1, 2000, averaging about 23 failures per year. The bank failures, while concerning, need to be looked at within the context of the broader banking environment to really understand what's happening. So, let's dive into the details and explore what happened, why it happened, and what it means for the rest of the year.

How Many Banks Have Failed in the US in 2025?

The Bank Failures of 2025: A Closer Look

So far in 2025, two banks have been closed. Let's break down the particulars of each:

• Pulaski Savings Bank, Chicago, IL
  • Closed: January 2025
  • Assets: Roughly $49.5 million
  • Deposits: Roughly $42.7 million
  • Acquired By: Millennium Bank
  • Impact: This failure cost the Deposit Insurance Fund around $28.5 million.
• The Santa Anna National Bank, Santa Anna, TX
  • Closed: June 2025
  • Assets: Approximately $63.8 million
  • Deposits: Approximately $53.8 million

It's crucial to understand the significance of these failures relative to past events. While any bank failure is a serious event, the scale of these failures is much smaller than the high-profile collapses we saw in 2023, such as Silicon Valley Bank, Signature Bank, and First Republic Bank. Those banks each had assets exceeding $100 billion. In 2024, we also saw two bank failures: Republic First Bank and The First National Bank of Lindsay.

So, what aren't we seeing right now? We are not seeing the same widespread panic that gripped the industry in early 2023. However, one must not relax yet!!

What's Behind These Bank Failures?

There are several factors at play that contributed to these failures. The banking sector is always influenced by wider economic trends like prevailing trends such as interest rate hikes, commercial real estate loan portfolio pressures, net interest margin compression and geopolitical and the regulatory climate is constantly ever-changing. Also, as an expert, I believe internal bank operations are hugely critical to their success. More on that later.

Here's the overall view:

1. Unrealized Losses on Securities: Banks hold a significant amount of securities, like government bonds and mortgage-backed securities. When interest rates rise, the value of these securities falls. Recent estimates suggest that the sector is sitting on quite a huge amount of unrealized losses. Because banks don't have to recognize these losses until they sell the assets, this poses a huge liquidity risk if there is a depositor runs.
2. Commercial Real Estate (CRE) loan pressure: This is a big one! Many smaller banks have a large chunk of their lending portfolio tied up in CRE, specifically office buildings. With remote work becoming more common, these properties face declining values, and banks are facing defaults and losses.
3. Profitability Squeeze:
   • Slower Economic Growth: Economic growth has slowed down, putting pressure on bank profitability.
   • Shrinking Net Interest Margins: The difference between what banks earn on loans and what they pay out on deposits is shrinking.
   • High Deposit Costs: Banks are paying more to attract and retain deposits.
   • Geopolitical Risks and Global Trade Tension
4. Regulatory Challenges: The FDIC is the main body responsible for supervising banks. However, with funding and and staffing hurdles, they have been under pressure to keep risk under control.

Beyond the Failures: Broader Trends in Banking

Bank failures are not the only indicator of the health of the banking sector. Here are some other key trends to consider:

• Branch Closures: Banks are continuing to shut down branches as customers shift to online banking.
• Digital Transformation Struggles: Banks are trying to modernize their technology, but many are struggling to keep up.
• Cybersecurity Threats: Banks face constant cyber-attacks, resulting in huge losses each year.

Looking Back: Bank Failures in Historical Context

It is important to keep things in perspective. While this year has seen two failures already, the two failures in 2025 continue a downward trend from the 570 bank failures recorded between 2001-2025 . Here's a quick trip down memory lane:

• 2008-2010 (Global Financial Crisis): Over 300 banks failed. It was a really bad time!
• 1980-1994 (Savings and Loan Crisis): Around 1,600 banks and 1,300 thrift institutions failed.

Compared to those huge crises, the current situation seems manageable.

What About the Rest of 2025?

What can we expect for the rest of 2025? A few things to keep an eye on include:

• Further interest rate hikes.
• Continued issues with commercial real estate loans.
• The potential for bank runs exists if depositors lose confidence.
• The FDIC's ability to keep pace with these challenges.

I think that the banking system is on the safer side compared to a year or two ago. However, with the potential for many things to go wrong, we should be vigilant. The small size of the bank collapse this year hints that the market has stabilized in the time after the crisis of 2023.

My Thoughts

My take on all of this is, while the numbers are low, complacency would be foolish. The underlying issues in the banking system are still very much alive. Commercial real estate is a ticking time bomb, and rising interest rates could trigger more problems. The health of the banking sector is very closely tied to the overall health of the economy.

What matters to me as a contributor is transparency and awareness. Citizens and business owners should know where the weaknesses are so they can be cautious and protect their assets. Small businesses, in particular, need to carefully consider their banking relationships and diversify where they can!

A Word About Deposit Insurance (FDIC)

For consumers who have their assets in banks, the FDIC is what keeps them safe. Let's face it––without deposit insurance, depositors would panic and the banking system would go down. I suggest you check the FDIC website (fdic.gov) for the current insurance limits.

Two bank failures in one year? Yep, that's right.  On June 27, 2025, the Santa Anna National Bank in Santa Anna, Texas, shut its doors, marking the second U.S. bank to fail that year after the closure of Pulaski Savings Bank in Chicago in January. The story isn't just about numbers; it's about a community losing a piece of its heart. Let's dive into what happened, why it matters, and what it means for the future of small-town banking.

Second Bank Failure in 2025: What Happened to Santa Anna National Bank?

A 90-Year Legacy Ends

Imagine your hometown bank, the place generations have trusted, suddenly closing. That’s what happened in Santa Anna, Texas. Santa Anna National Bank, established in 1933, was more than just a place to deposit money; it was a cornerstone of the community. For over nine decades, it supported local families, ranchers, and small businesses in Coleman and Brown counties.

As of June 18, 2025, the bank reported total assets of $63.8 million and total deposits of $53.8 million. However, approximately $2.8 million in deposits exceeded the FDIC’s insurance limit of $250,000 per depositor, per ownership category.

Here's a quick look at the bank's key stats:

Aspect	Details
Bank Name	Santa Anna National Bank
Location	Santa Anna, Texas
Closure Date	June 27, 2025
Reason for Failure	Suspected fraud
Assuming Bank	Coleman County State Bank, Coleman, Texas
Premium for Insured Deposits	5.16%
Estimated Cost to DIF	$23.7 million
Total Assets (June 18, 2025)	$63.8 million
Total Deposits (June 18, 2025)	$53.8 million
Estimated Uninsured Deposits	$2.8 million (subject to change)
FDIC Contact for Uninsured Deposits	(1-866) 314-1744

The bank's closure isn't just a financial hit; it’s a blow to the identity of a town where community institutions hold immense value. I can imagine the shock and worry rippling through Santa Anna when the news broke. It's a reminder of how much small communities rely on their local banks.

Why Did Santa Anna National Bank Fail?

The official reason for the closure, according to the Office of the Comptroller of the Currency (OCC), was “unsafe or unsound practices,” with suspected fraud cited as the primary cause. Details are scarce, likely due to an ongoing investigation(s). This raises questions about the bank's internal controls and oversight…and it makes me personally worry about the checks and balance in place to protect these smaller, crucial banks.

The FDIC estimates the cost to the Deposit Insurance Fund (DIF) at $23.7 million, which is covered by fees paid by member banks, not taxpayer funds. While the financial impact seems relatively contained, the loss of such a long-standing institution is significant.

The Takeover: Coleman County State Bank Steps In

In the wake of the closure, Coleman County State Bank in Coleman, Texas, stepped in to assume the insured deposits of Santa Anna National Bank. This move ensured that most customers experienced minimal disruption.

Here's what that transition looked like:

• The Santa Anna branch reopened as a Coleman County State Bank office on June 30, 2025.
• Customers with insured deposits (up to $250,000 per depositor, per ownership category) continued to have access to their accounts without needing to do anything.
• For those with deposits exceeding the FDIC limit, the FDIC provided a toll-free number and website for checking insurance status and filing claims.

Reave Scott, CEO of Coleman County State Bank, expressed enthusiasm about welcoming the staff of Santa Anna National Bank and continuing to serve the community. I believe that kind of continuity is crucial in preserving trust and stability.

The Ripple Effect: Impacting the Santa Anna Community

The closure of Santa Anna National Bank sends ripples throughout the small town, shaking the community that depended on it for generations.

Here's what's at stake:

• Loss of a Local Lender: Small businesses and ranchers often rely on local banks for loans and financial advice. With Santa Anna National Bank gone, these individuals may face challenges in securing funding.
• Community Identity: The bank was an integral part of Santa Anna's identity. Its absence leaves a void that's hard to fill.
• Economic Confidence: A bank failure can shake confidence in the local economy. Residents might worry about the stability of other businesses and institutions.

What Does This Mean for Other Small Banks?

The failure of Santa Anna National Bank underscores the vulnerabilities of small community banks. While larger banks often have more resources and sophisticated risk management systems, smaller banks may struggle to compete and adapt to changing economic conditions.

Here are some key considerations:

• Regulatory Scrutiny: Regulators will likely increase scrutiny of small banks to ensure they are operating safely and soundly. This could mean more frequent audits and stricter enforcement of regulations.
• Consolidation: We may see more mergers and acquisitions of small banks as they seek to gain scale and efficiency. This could lead to fewer independent community banks.
• Technology Adoption: Small banks need to invest in technology to remain competitive and meet the changing needs of their customers. This includes online and mobile banking platforms, as well as cybersecurity measures.

Bank Failures in the US: A Broader Perspective

While the Santa Anna National Bank failure may seem isolated, it's part of a larger trend of bank failures and economic instability. It is important to put this occurance into its broader economic picture

Here are some factors to consider:

• Economic Downturn: Economic downturns can put pressure on banks as borrowers struggle to repay loans. This can lead to higher loan losses and bank failures.
• Rising Interest Rates: Rapidly rising interest rates can also strain banks, especially those with large holdings of long-term assets.
• Regulatory Changes: Changes in banking regulations can also impact the profitability and stability of banks.

Protecting Your Deposits: What You Need to Know

The Santa Anna National Bank failure serves as a reminder of the importance of understanding deposit insurance. Here are some key points to keep in mind:

• FDIC Insurance: The FDIC insures deposits up to $250,000 per depositor, per ownership category. This means that if your bank fails, you will be protected up to that limit.
• Understanding Ownership Categories It is important to understand different ownership categories in order to maximize your insurance coverage.
• Review Your Coverage Regularly: Make sure you understand your deposit insurance coverage and review it periodically to ensure it meets your needs.

If you have deposits exceeding $250,000 at a single bank, consider diversifying your deposits across multiple institutions to maximize your insurance coverage.

In Summary

The failure of Santa Anna National Bank had a strong, real impact on a small community. My heart goes out to the citizens of Santa Anna, Texas. While most deposits were protected, the loss of a long-standing community institution is a significant blow. It is a reminder of how interconnected are community members, the crucial role small banks play, and the impact one event can have on everyday people. While the investigation unfolds, I hope community members stay strong and lean on each other to rebuild from this financial and social setback.