I am running OpenSUSE.

Here is the output of ssh -vvv:

OpenSSH_5.8p1, OpenSSL 1.0.0c 2 Dec 2010
debug1: Reading configuration data /etc/ssh/ssh_config
debug1: Applying options for *
debug2: ssh_connect: needpriv 0
debug1: Connecting to <ipaddress> [ipaddress] port 22.
debug1: Connection established.
debug1: permanently_set_uid: 0/0
debug3: Incorrect RSA1 identifier
debug3: Could not load "/root/.ssh/id_rsa" as a RSA1 public key
debug2: key_type_from_name: unknown key type '-----BEGIN'
debug3: key_read: missing keytype
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug3: key_read: missing whitespace
debug2: key_type_from_name: unknown key type '-----END'
debug3: key_read: missing keytype
debug1: identity file /root/.ssh/id_rsa type 1
debug1: identity file /root/.ssh/id_rsa-cert type -1
debug1: identity file /root/.ssh/id_dsa type -1
debug1: identity file /root/.ssh/id_dsa-cert type -1
debug1: identity file /root/.ssh/id_ecdsa type -1
debug1: identity file /root/.ssh/id_ecdsa-cert type -1
debug1: Remote protocol version 2.0, remote software version OpenSSH_5.1
debug1: match: OpenSSH_5.1 pat OpenSSH*
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_5.8
debug2: fd 3 setting O_NONBLOCK
debug3: load_hostkeys: loading entries for host "ipaddress" from file "/root/.ssh/known_hosts"
debug3: load_hostkeys: found key type RSA in file /root/.ssh/known_hosts:4
debug3: load_hostkeys: loaded 1 keys
debug3: order_hostkeyalgs: prefer hostkeyalgs: [email protected],[email protected],ssh-rsa
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug2: kex_parse_kexinit: ecdh-sha2-nistp256,ecdh-sha2-nistp384,ecdh-sha2-nistp521,diffie-hellman-group-exchange-sha256,diffie-hellman-group-exchange-sha1,diffie-hellman-group14-sha1,diffie-hellman-group1-sha1
debug2: kex_parse_kexinit: [email protected],[email protected],ssh-rsa,[email protected],[email protected],[email protected],[email protected],[email protected],ecdsa-sha2-nistp256,ecdsa-sha2-nistp384,ecdsa-sha2-nistp521,ssh-dss
debug2: kex_parse_kexinit: aes128-ctr,aes192-ctr,aes256-ctr,arcfour256,arcfour128,aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,aes192-cbc,aes256-cbc,arcfour,[email protected]
debug2: kex_parse_kexinit: aes128-ctr,aes192-ctr,aes256-ctr,arcfour256,arcfour128,aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,aes192-cbc,aes256-cbc,arcfour,[email protected]
debug2: kex_parse_kexinit: hmac-md5,hmac-sha1,[email protected],hmac-ripemd160,[email protected],hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: hmac-md5,hmac-sha1,[email protected],hmac-ripemd160,[email protected],hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: none,[email protected],zlib
debug2: kex_parse_kexinit: none,[email protected],zlib
debug2: kex_parse_kexinit: 
debug2: kex_parse_kexinit: 
debug2: kex_parse_kexinit: first_kex_follows 0 
debug2: kex_parse_kexinit: reserved 0 
debug2: kex_parse_kexinit: diffie-hellman-group-exchange-sha256,diffie-hellman-group-exchange-sha1,diffie-hellman-group14-sha1,diffie-hellman-group1-sha1
debug2: kex_parse_kexinit: ssh-rsa,ssh-dss
debug2: kex_parse_kexinit: aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour128,arcfour256,arcfour,aes192-cbc,aes256-cbc,[email protected],aes128-ctr,aes192-ctr,aes256-ctr
debug2: kex_parse_kexinit: aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour128,arcfour256,arcfour,aes192-cbc,aes256-cbc,[email protected],aes128-ctr,aes192-ctr,aes256-ctr
debug2: kex_parse_kexinit: hmac-md5,hmac-sha1,[email protected],hmac-ripemd160,[email protected],hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: hmac-md5,hmac-sha1,[email protected],hmac-ripemd160,[email protected],hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: none,[email protected]
debug2: kex_parse_kexinit: none,[email protected]
debug2: kex_parse_kexinit: 
debug2: kex_parse_kexinit: 
debug2: kex_parse_kexinit: first_kex_follows 0 
debug2: kex_parse_kexinit: reserved 0 
debug2: mac_setup: found hmac-md5
debug1: kex: server->client aes128-ctr hmac-md5 none
debug2: mac_setup: found hmac-md5
debug1: kex: client->server aes128-ctr hmac-md5 none
debug1: SSH2_MSG_KEX_DH_GEX_REQUEST(1024<1024<8192) sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_GROUP
debug2: dh_gen_key: priv key bits set: 138/256
debug2: bits set: 529/1024
debug1: SSH2_MSG_KEX_DH_GEX_INIT sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_REPLY
debug1: Server host key: RSA cb:7f:ff:2e:65:28:f0:95:e6:8a:71:24:2a:67:02:2b
debug3: load_hostkeys: loading entries for host "<ipaddress>" from file "/root/.ssh/known_hosts"
debug3: load_hostkeys: found key type RSA in file /root/.ssh/known_hosts:4
debug3: load_hostkeys: loaded 1 keys
debug1: Host '<ipaddress>' is known and matches the RSA host key.
debug1: Found key in /root/.ssh/known_hosts:4
debug2: bits set: 504/1024
debug1: ssh_rsa_verify: signature correct
debug2: kex_derive_keys
debug2: set_newkeys: mode 1
debug1: SSH2_MSG_NEWKEYS sent
debug1: expecting SSH2_MSG_NEWKEYS
debug2: set_newkeys: mode 0
debug1: SSH2_MSG_NEWKEYS received
debug1: Roaming not allowed by server
debug1: SSH2_MSG_SERVICE_REQUEST sent
debug2: service_accept: ssh-userauth
debug1: SSH2_MSG_SERVICE_ACCEPT received
debug2: key: /root/.ssh/id_rsa (0xb789d5c8)
debug2: key: /root/.ssh/id_dsa ((nil))
debug2: key: /root/.ssh/id_ecdsa ((nil))
debug1: Authentications that can continue: publickey,keyboard-interactive
debug3: start over, passed a different list publickey,keyboard-interactive
debug3: preferred publickey,keyboard-interactive,password
debug3: authmethod_lookup publickey
debug3: remaining preferred: keyboard-interactive,password
debug3: authmethod_is_enabled publickey
debug1: Next authentication method: publickey
debug1: Offering RSA public key: /root/.ssh/id_rsa
debug3: send_pubkey_test
debug2: we sent a publickey packet, wait for reply

It hangs here for a good 30 seconds to a minute then

debug1: Authentications that can continue: publickey,keyboard-interactive
debug1: Trying private key: /root/.ssh/id_dsa
debug3: no such identity: /root/.ssh/id_dsa
debug1: Trying private key: /root/.ssh/id_ecdsa
debug3: no such identity: /root/.ssh/id_ecdsa
debug2: we did not send a packet, disable method
debug3: authmethod_lookup keyboard-interactive
debug3: remaining preferred: password
debug3: authmethod_is_enabled keyboard-interactive
debug1: Next authentication method: keyboard-interactive
debug2: userauth_kbdint
debug2: we sent a keyboard-interactive packet, wait for reply
debug2: input_userauth_info_req
debug2: input_userauth_info_req: num_prompts 1

I added PubkeyAuthentication no to the /etc/ssh/ssh_config and the /etc/ssh/sshd_config which makes it faster getting to the password prompt, but the password prompt still takes some time. Any way to fix that?

Here is where the password hangs

debug3: packet_send2: adding 32 (len 25 padlen 7 extra_pad 64)
debug2: input_userauth_info_req
debug2: input_userauth_info_req: num_prompts 0
debug3: packet_send2: adding 48 (len 10 padlen 6 extra_pad 64)
debug1: Authentication succeeded (keyboard-interactive).
Authenticated to ipaddress ([ipaddress]:22).
debug1: channel 0: new [client-session]
debug3: ssh_session2_open: channel_new: 0
debug2: channel 0: send open
debug1: Requesting [email protected]
debug1: Entering interactive session.

FIXED!!!!!!!!!!!!!! What is did... In the nsswitch_conf I had ldap included in the group and passwd which slows it down a lot. Thank you everybody for your input

passwd: compat
group:  files 

hosts:  files dns
networks:       files dns