America is now heading for its worst year for bank failure since 1993 as the number of failures reaches 2008’s total with less than a third of 2009 gone.

Two more US banks were closed at the weekend, to bring to 25 the number shut so far in 2009, which is equal to the toll of failures in 2008.

That was the worst year since 1993, which was the peak of the long list of failures seen in the slump of the early 1990s.

This year will see more failures as the key regulator, the Federal Deposit Insurance Corporation, was watching around 250 banks on its doubtful list at the end of December.

But none of the collapses so far have been as large as the huge failure of Washington Mutual in September 2008. It imploded in the wake of the collapse of the Lehman Brothers investment bank in mid-September.

The two latest were regional banks in Missouri and Nevada with assets of $US181 million and $US270 million respectively. They were around $US200 million or less each in assets.

Fed Chairman Ben Bernanke summed up the damage from the bank failures and other doubtful lending practices in a speech in the US.

He told a Fed-sponsored conference on community banking on Friday:

“And the damage from this turn in the credit cycle — in terms of lost wealth, lost homes, and blemished credit histories — is likely to be long-lasting. One would be forgiven for concluding that the assumed benefits of financial innovation are not all they were cracked up to be.”

That’s as direct bagging of banking, as practiced in the US for the past decade and a half, as anything a Fed chairman has uttered in recent years.

But the rising failure list comes as major US banks report signs of improving performance and escalate campaigns to try and wriggle free of the Federal Government capital injections (So-called TARP aid) because they don’t like its restrictions and the involvement it gives the government in their affairs.

They created the systemic crisis that brought the world economy (let alone the US) to the brink of depression, now they don’t want to repay the debt and go through what tens of millions of people are doing globally: no work, shorter hours, losing their homes, paying off debts and picking up the pieces.

Having caused the crisis, then been bailed out by taxpayers, and received all the benefits of not losing their jobs or the ignominy of presiding over failure, the likes of Goldman Sachs and JPMorgan executives now want to return to making hay, without restrictions.

Goldman Sachs wants to return its $US10 billion, JP Morgan is aiming for the day to get rid of its $US25 billion prop, but Citigroup was more circumspect and there’s a sneaking concern that Citi may not be as healthy as management lets on.

The earnings of all three banks were boosted in the first quarter by trading profits from the investment banking divisions, not from bank lending: as well the banks are refinancing home mortgages using very cheap money from the Fed (which is underwriting their trading profits).

Citi won’t start the process to issue 36% of its capital to the Government (and converting expensive preference shares) until the results of the stress tests conducted by the Government, are released on May 4. There’s a suspicion or three that Citi’s report card might be marked “needs more capital from Washington”.

Goldman Sachs omitted a loss making month in last December as it moved to a calendar financial year from this year (it would have cut earnings in half) and JPMorgan and Citi wrote-off and increased bad debt provisions by billions of dollars as subprime mortgages, toxic loans and credit cards took their toll.

Credit cards, personal and car loans and home loans are the new black holes as unemployment soars (Seven American states now have jobless rates of 10% or more, California’s now 11.2%).

Having grabbed the help of taxpayers with Government capital and guarantees, banks of all sizes now want to give back the money and go off any try and revert to the glory days of 2006, without a second thought.

If the Fed takes the cheap money away and boosts interest rates to more realistic levels, most American banks would be exposed as being weak at best, or at worst, broke or close to insolvent. They continue in business at the whim of Washington, the Fed and Treasury.

They should be made to pay and not wriggle free of their responsibilities.