Not a Pretty Picture for Banks

FDIC's Quarterly Banking Profile for the Fourth Quarter 2007 is a bit grim.

• Quarterly net income for FDIC-insured institutions declined to a 16-year low.
• Record high loan loss provisions, record losses in trading activities, and good will impairment expenses were significant negative factors.
• One in four large institutions lost money in the fourth quarter.
• Net interest margins continue to decline.
• Full-year earnings fell to a 5-year low.
• Net charge-offs rose to a 5-year high.
• Three FDIC-insured institutions failed in 2007.

There is some good news:

• Asset growth remains strong.
• Domestic deposits posted record growth.
• Trust income rose.

Link:  http://www2.fdic.gov/qbp/2007dec/qbp.pdf

(ag) Mar. 5, 2008, in FDIC.