Bank profits up; problems still growing
Bank earnings hit their highest level since the third quarter of 2007, the FDIC says. Bank failures are rising but should level out.
Federal Deposit Insurance Corp.'s quarterly report card, released
today, showed the list of "problem banks" reached 829 in the second quarter, an
increase of 54 lenders, many of which were small community banks.
While that is a smaller increase than in previous
quarters, the number of problem banks remains at its highest level in
more than 16 years.
Not all of those banks will founder, but officials said they expected the number of
failures to peak later this year. So far this year, 118 banks have
failed, with 45 closing in the second quarter.
Even so, bank earnings continue to rebound. The banking industry posted a $21.6 billion profit in the second quarter as loan losses stabilized, the FDIC said.
That profit was nearly five times as
large as the $4.4 billion a year ago, and it was the industry’s best
results since the credit card crisis began in the third quarter in 2007,
The New York Times said.
Banks are also setting
aside less money to cover future losses than they were before and
taking advantage of ultra-low interest rates to improve lending margins.
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[BRIEFING.COM] The stock market finished an upbeat week on a mixed note. The S&P 500 added just over a point, holding its weekly gain at 1.0% while the Nasdaq lost 0.4%.
The major averages began the day on an upbeat note, but relinquished their opening gains during the first 90 minutes of action. The early sentiment was boosted by a better-than-expected nonfarm payrolls report for February (175K versus Briefing.com consensus 163K), but a closer look into the report suggested that ... More
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