U.S. banks earn 34.7 billion dollars in 2012 Q4

U.S. banks earn 34.7 billion dollars in 2012 Q4
# 27 February 2013 02:02 (UTC +04:00)

Baku-APA. U.S. banks reported strong profit growth in the fourth quarter of 2012, the Federal Deposit Insurance Corp. (FDIC) said Tuesday, APA reports quoting Xinhua.

FDIC-insured commercial banks and savings institutions earned 34.7 billion U.S. dollars for the last three months of 2012, 36.9 percent more than the same period in 2011. It was the 14th consecutive quarter since U.S. banks saw quarterly net earnings improve.

Sixty percent of all institutions reported improvements in their quarterly net income from a year ago, while the share of institutions reporting net losses for the quarter fell to 14 percent from 20.2 percent a year earlier, the agency said.

"The improving trend that began more than three years ago gained further ground in the fourth quarter," said FDIC Chairman Martin J. Gruenberg.

The FDIC also said the number of "problem" banks declined from 694 to 651 in the fourth quarter of 2012, with only eight insured institutions failed, the smallest quarterly total since the second quarter of 2008. For all of 2012, there were 51 insured institution failures, compared with 92 in 2011.

Industry earnings totaled 141.3 billion U.S. dollars in 2012, the second-highest annual profit ever reported by the industry after the 145.2 billion U.S. dollars earned in 2006, indicating that the U.S. banking industry has recovered from the recent financial crisis.

This was mainly driven by higher noninterest income and lower provisions for loan losses. Banks set aside 58.2 billion U.S. dollars in loss provisions in 2012, 24.9 percent lower than 2011, and noninterest income was 8 percent higher in 2012 from a year ago.

Congress created the FDIC in 1933 to restore public confidence in the country's banking system. Now the FDIC insures deposits at the country's 7,083 banks and savings associations.

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