No, we're not out of the woods - not by a long shot. The banking sector is still weak, and ripe for another shock, such as a Greek collapse or another spur to a meltdown.
More than 90 U.S. banks and thrifts missed making a May 17 payment to the U.S. government under its main bank bailout program, signaling a rising number of lenders are struggling to meet their obligations.
The statistics, compiled by SNL Financial from U.S. Treasury data, showed 91 banks and thrifts skipped the May dividend payment under the Troubled Asset Relief Program, or TARP. It was the first missed payment for 23 of the banks; for the others, it was at least their second miss.
The number of banks missing their TARP payments rose for the third straight quarter. In February, 74 banks deferred their payments; 55 deferred last November.
SNL Financial's analysis found 20 banks have missed four or more payments since the program began in 2008, while eight banks have missed five payments.
Under the TARP program, the U.S. Treasury invested in preferred shares issued banks looking for funds. The banks were to make regular dividend payments to the Treasury, and have the right to repurchase the shares at some point in the future.
Since the FDIC was strengthened last year, individual depositor's are not at risk of losing their savings, even if all these banks go belly up, which is not likely anyway. But the failure to make timely payments to the Treasury by these institutions does not bode well for banking stability as we head into the summer and the possibility that any shock at all to the system could start the dominoes falling.