Those banks include Bank of America Corp., Citigroup Inc., JPMorgan and Wells Fargo & Co. Most of them have recovered with help from federal bailout money and record-low borrowing rates.
The number of banks on the FDIC's confidential "problem" list fell in the third quarter to 694, or around 9.6 percent of all federally insured banks. That compares with 732 troubled banks in the second quarter.
So far this year, 50 banks have failed. That's far below the 92 banks that shuttered last year and the 157 that closed in 2010 — the most for one year since the height of the savings and loan crisis in 1992.
In the third quarter, the decline in bank failures allowed the insurance fund to strengthen. The fund turned from deficit to positive in the second quarter of 2011 and had a $25.2 billion balance as of Sept. 30, according to the FDIC. That compares with $22.7 billion at the end of June.
The FDIC is backed by the government, and its deposits are guaranteed up to $250,000 per account. Apart from its deposit insurance fund, the agency also has tens of billions in loss reserves.