Because of increased net interest income, commercial banks and savings institutions insured by the Federal Deposit Insurance Corp. reported third-quarter aggregate earnings of $47.9 billion, a 5.2 percent increase from a year earlier.
The 5,737 insured institutions that reported their quarterly earnings to the FDIC posted a combined 7.4 percent increase in net interest income to $127.5 billion, according to a news release.
“Revenue and net income were higher at most banks, net interest margin improvement was widespread, and the number of unprofitable banks and ‘problem banks’ continued to fall,” FDIC Chairman Martin Gruenberg said in the release. “While the quarterly results were largely favorable, the industry continued to see a gradual slowdown in the annual rate of loan growth.
“An extended period of low interest rates and an increasingly competitive lending environment have led some institutions to reach for yield.”
Third-quarter financial notes:
• More than 80 percent of reporting banks posted higher net interest income than a year earlier.
• The 5,294 insured institutions that are community banks increased aggregate net income by $513 million to $6 billion.
• Total loans and leases rose 1 percent, or by $96.2 billion.
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