Washington: US banks reported strong profit growth in the fourth quarter of 2012, the Federal Deposit Insurance Corp (FDIC) said.
FDIC-insured commercial banks and savings institutions earned $34.7 billion for the last three months of 2012 -- 36.9 percent more than the same period in 2011. It was the 14th consecutive quarter since US banks saw quarterly net earnings improve, reported Xinhua.
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 Tuesday.
"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 that 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 totalled $141.3 billion in 2012, the second-highest annual profit ever reported by the industry after the $145.2 billion earned in 2006, indicating that the US banking industry has recovered from the recent financial crisis.
This was mainly driven by higher non-interest income and lower provisions for loan losses. Banks set aside $58.2 billion in loss provisions in 2012, 24.9 percent lower than 2011, and non-interest income was 8 percent higher in 2012 from a year ago.
First Published: Wednesday, February 27, 2013, 14:03