Gov. Snyder is threatening Detroit with an emergency manager while banks rake in $35 billion in last three months; he has already cut tens of thousands of Michigan families off public assistance. MAKE THE BANKS PAY!
Fewer institutions are on ‘problem’ list
Nov. 23, 2011
By Derek Kravitz
Associated Press
WASHINGTON — Bank earnings rose over the summer to their highest level in more than four years, while the number of troubled banks fell for the second straight quarter, federal regulators reported Tuesday.
The Federal Deposit Insurance Corp. said the banking industry earned $35.3 billion in the July-September quarter. That’s up from $23.8 billion in the same period last year.
More than 60% of banks reported improved earnings.
Happy Bankster
The better earnings and fewer troubled banks suggest that the industry is steadily improving from the depths of the 2008 financial crisis.
“Bank balance sheets are stronger in a number of ways, and the industry is generally profitable, but the recovery is by no means complete,” said Martin Gruenberg, FDIC’s acting chairman.
The FDIC also said there were 844 banks on its confidential “problem” list in the quarter, or roughly 11.5% of all federally insured banks.
That was down from 865 in the April-June period, which was the first quarter in five years to show a decline.
Banks with assets exceeding $10 billion drove the bulk of the earnings growth.
They made up 1.4% of all banks but accounted for about $29.8 billion of the industry’s earnings in thethird quarter.
Those are the largest banks, such as Bank of America, Citigroup, JPMorgan Chase and Wells Fargo. Most of these banks have recovered with help from federal bailout money and record-low borrowing rates.
FDIC officials say the bulk of the gains were because banks, especially credit card companies, set aside less money for potential losses.
In the July-September period, banks put aside $18.6 billion. That’s the lowest amount in four years.
But the industry continues to struggle with flat growth in loans. Banks’ loan balances increased $21.8 billion in the third quarter.
That was a modest gain. But it marked the second-straight quarter in three years that balances have grown, the FDIC said.
