FDIC's Problem List Shrinks in Q2, First Time Since 2006
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The Federal Deposit Insurance Corporation said Tuesday banks insured by it saw profits increase by 38 percent to $28.8 billion in the second quarter of 2011.
According to the FDIC: "majority of all institutions (60 percent) reported improvements in their quarterly net income from a year ago. Also, the share of institutions reporting net losses for the quarter fell to 15.2 percent, down from 20.8 percent a year earlier. The average return on assets (ROA), a basic yardstick of profitability, rose to 0.85 percent, from 0.63 percent a year ago."
More importantly, the FDIC reported the number of institutions on its "Problem List" fell for the first time in 15 quarters.
The FDIC's Problem List has been growing since the third quarter of 2006, before Apple's (Nasdaq: AAPL) iPhone was introduced and when mortgage-backed securities were still a hot commodity.
From the FDIC: "Total assets of Problem institutions declined from $397 billion to $372 billion. Twenty-two insured institutions failed during the second quarter, four fewer than in the previous quarter, and the fewest since the first quarter of 2009. This is the fourth quarter in a row that the number of failures has declined."
Other key metrics of the report:
According to the FDIC: "majority of all institutions (60 percent) reported improvements in their quarterly net income from a year ago. Also, the share of institutions reporting net losses for the quarter fell to 15.2 percent, down from 20.8 percent a year earlier. The average return on assets (ROA), a basic yardstick of profitability, rose to 0.85 percent, from 0.63 percent a year ago."
More importantly, the FDIC reported the number of institutions on its "Problem List" fell for the first time in 15 quarters.
The FDIC's Problem List has been growing since the third quarter of 2006, before Apple's (Nasdaq: AAPL) iPhone was introduced and when mortgage-backed securities were still a hot commodity.
From the FDIC: "Total assets of Problem institutions declined from $397 billion to $372 billion. Twenty-two insured institutions failed during the second quarter, four fewer than in the previous quarter, and the fewest since the first quarter of 2009. This is the fourth quarter in a row that the number of failures has declined."
Other key metrics of the report:
- The Deposit Insurance Fund balance was positive for the first time in two years.
- Loan portfolios grew for the first time in three years.
- Large institutions experienced sizable deposit inflows.
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