Aug. 24--The pace of bank failures is likely to pick up soon as bad loans and mounting losses erode the capital of dozens of financial institutions.

"You should expect to see 100 to 150 banks fail before the end of the year," said Richard Bove, Lutz-based bank analyst for Ladenburg Thalmann. However, he said the problems are "not remotely close" to those that faced the banking system in 1990.

Nine banks have failed so far this year, most notably IndyMac Bank in California. This month, First Priority Bank in Bradenton became the first Florida bank to fail since 2004.

Whether or not Bove is right about the number of failures, it's clear that problems are growing. The Federal Deposit Insurance Corp. had 90 banks on its confidential problem bank list after the first quarter, up from 76 at year's end. The second-quarter number will be released Tuesday and is expected to be more than 100. However, the FDIC's list is by no means a complete list of banks that might be closed or merged out of business; IndyMac wasn't even on the list when the FDIC shut it down.

One sign of the problems is the plethora of advertisements for high-yielding money market accounts and CDs. When people know that a bank is having difficulty, deposits are hard to keep, said Benjamin Bishop Jr., chairman of Allen C. Ewing Co., a Jacksonville investment banking firm.

"The way they keep them is by paying a rate that's higher than the market. It's squeezing all the banks. On top of asset problems, that is making this a difficult period for banks," Bishop said.

Bove says that while some big banks have been the topic of negative news lately, the threat of closure is concentrated in small banks. That means any sharp uptick in failures may not be big enough to have any significant impact on the U.S. financial system.

"The 6,000 banks at the bottom of the industry don't have enough assets all together to equal one Citibank," he said. "If 150 banks fail and they knock $20-billion in assets out of the system, it doesn't matter."

In fact, Bove thinks big banks will benefit from the chaos and low share prices and emerge much stronger. "These stocks offer a once-in-a-generation opportunity to make money."

Others aren't so sanguine about the fate of big banks. On Monday , a former International Money Fund economist predicted that a large U.S. bank or investment bank will fail in the next few months.