Unlike banks on Wall Street, these smaller banks didn’t invest in risky mortgage-backed securities or complex derivatives.

Despite dire headlines about the credit crunch and the shaky state of financial giants like Citigroup, the vast majority of banks in the United States are doing well.

In fact, many are actually thriving and still making loans to help to grow local businesses and keep families in their homes.

Think of it as a modern-day version of “It’s a Wonderful Life” – the 1940s movie in which local banker George Bailey gives up his own dreams to save his hometown from greedy businessman Mr. Potter.

Today, there are more than 7,000 community banks that are small, community oriented, and determined to keep their assets local.

They’re the Main Street banks, which, unlike those on Wall Street, did not invest in risky mortgage-backed securities or complex derivatives. And so their balance sheets remain relatively healthy.

While they account for less than 10 percent of America’s total banking assets, their traditional, values-based approach contains plenty of lessons for their larger Wall Street counterparts, some analysts say.

infacted banks,Has the threat from Net-only banks vanished for good, or is it merely lying dormant, like a virus prepared to attack your best

Has the threat from Net-only banks vanished for good, or is it merely lying dormant, like a virus prepared to attack your best customers when the business cycle turns?

As mentioned on page one, with the highly visible failures of three Net-only pioneers, SFNB, CompuBank, and Wingspan Bank, it’s tempting to write the obituary for the whole segment. But that ignores the impressive inroads made by aggressive entrants such as ING Direct which has signed up more than 200,000 accounts for its Orange product line; Virtual Bank which turned profitable with its full-service Net-only bank just 15 months after launch; DeepGreen Bank which is booking $100 million in home equity lines from 7,000 applicants (Aug. ‘01 actual results per company); and PayPal, LendingTree, and NextCard, which all have more than a million customers now.

You can also look to Europe where more innovative Net-only companies (e.g., Egg, Smile.co.uk, First-e, and Virgin Money) initially made more inroads than similar U.S. companies. However, these companies have been hit by the downturn, with First-e announcing (Sept. 7) that it was withdrawing from the UK and German markets.

But it doesn’t look like any of the grandiose forecasts made by some of the early Net-only companies will come to pass in this decade anyway. We remember being told by a Net-only bank founder that his new company would be among the five largest U.S. banks within 5 years. At this point, I doubt the execs at BofA, Wells, Citi, JP Morgan Chase, or Bank One, are too worried about being unseated by a startup.

In fact, in the U.S., the total market share of Net-only banks is less than the rounding error on total industry revenues. Households using any Net-only bank account number more than 1 million (not including PayPal’s 10 million), that figure is only about 7% of all households banking online.

In the coming months, foreclosures are going to dominate every market in Orange County, and affect housing values in every neighborhood.

In the coming months, foreclosures are going to dominate every market in Orange County, and affect housing values in every neighborhood. Throughout the county, there are currently 5954 bank-owned properties, with another 3801 up for auction and 8723 in a state of pre-foreclosure. In Brea alone, there are 91 pre-foreclosures, 34 auctions, and 66 REOs, meaning the number of foreclosed properties is only going to increase over the course of this year.

What does this mean for you? The high number of foreclosures means a large inventory of properties that banks are eager to sell. In Brea, the amount of time it will take to sell this abundance of inventory is 14.9 months. Because of this, banks will accept lower prices than usual in order to clear these properties off their books at a faster rate. In fact, bank repos will always be cheaper than the house next door that is an equity seller. This situation represents a unique opportunity for buyers!