State banks are failing (8)
I believe the answer is:
nebraska
'state' is the definition.
(Nebraska is an example)
'banks are failing' is the wordplay.
'failing' is an anagram indicator.
'banks'+'are'='banksare'
'banksare' with letters rearranged gives 'NEBRASKA'.
(Other definitions for nebraska that I've seen before include "Where Lincoln found" , "location of Lincoln" , "US Great Plains state" , "State of the western US" , "State of central US" .)